Gold, silver prices go up, analysts decode reasons
Concerns over China's regulations for its once-freewheeling internet sector and turmoil in Afghanistan kept investors on the edge. Gold is considered a safe store of value during times of political and financial uncertainty.
Prices of gold went on an upward trajectory on Tuesday, gaining ₹446 per 10 gram. According to HDFC Securities, gold reached ₹46,460 (per 10 gram) after the latest hike today. Recovery in global precious metal prices and rupee depreciation also played a role, the financial services firm added.
In the previous session, the precious metal had ended at ₹46,014 per 10 grams.
Silver also saw its price increasing by ₹888 per kilogram to reach ₹62,452. In the previous trading session, silver closed at ₹61,564 per kg.
Impact of Delta variant?
Tapan Patel, who works as senior analyst at HDFC Securities, said that gold prices extended gains on worries over fast spreading Delta variant cases.
In the international market too, gold was trading higher at $1,793 per ounce. Silver, meanwhile, was flat at $23.88 per ounce.
"Some governments are slightly over reacting to Covid-19 cases, raising concerns that there could be another economic slowdown," said Michael Hewson, chief market analyst at CMC Markets UK.
Is Afghanistan crisis having an impact?
Concerns over China's regulations for its once-freewheeling internet sector and turmoil in Afghanistan also kept investors on the edge.
Situations like turmoil in Afghanistan usually does not affecte the price of gold. "But the swift and apparently complete Taliban victory may indirectly support 'safe haven' assets such as bullion, even if only modestly," said HSBC.
"The impact on gold may be greater than at first imagined," it added.
Gold is considered a safe store of value during times of political and financial uncertainty.