Gold, silver rally takes a breather
After touching an all-time high on Thursday, gold took a breather on Friday with its prices falling by Rs 100 to end at Rs 23,120 per 10 grams on sluggish demand and expectations of a stimulus to US economy not coming through.business Updated: Jul 15, 2011 22:31 IST
After touching an all-time high on Thursday, gold took a breather on Friday with its prices falling by Rs 100 to end at Rs 23,120 per 10 grams on sluggish demand and expectations of a stimulus to US economy not coming through.
The yellow metal had climbed to an all-time high of Rs 23,220 on Thursday due to the deepening debt crisis in the European Union, and a ratings downgrade threat hanging over the US.
Following the trend, silver declined by Rs 800 to Rs 56,500 per kilogram on Friday. It had closed at closed at Rs 57,300 on Thursday — a gain of around 10% this week. Since January, gold prices have risen by around 14% and silver by 25%.
"Uncertainties in the global economy are pushing up the gold and silver prices," said Hitesh Jain, commodity analyst – India private client, India Infoline. "Prices are expected to remain firm as there are no clear signs of the debt crisis in Europe ending soon."
According to the World Gold Council, India was the strongest market for gold in 2010 with total demand rising by 66% to 963 tonnes, despite the high prices. And with the festival season round the corner, demand will only rise, the council said in a recent report.
Financial planners suggest that investment in gold should not be more than 10% of a person's total investment portfolio. For silver less than 5% is recommended.
"If investment in gold is less than 10% of total investments, go for gold," said Vishal Dhawan, founder, Plan Ahead Wealth Advisors. "People with higher exposure than this should sell."
First Published: Jul 15, 2011 22:29 IST