Gold prices hit an all-time high
The price of gold witnessed an unprecedented jump on Wednesday after the domestic and international market saw heavy stocking of the yellow metal following news of USA raising the debt ceiling.Updated: Aug 04, 2011 00:35 IST
The price of gold witnessed an unprecedented jump on Wednesday after the domestic and international market saw heavy stocking of the yellow metal following news of USA raising the debt ceiling.
During trading on Wednesday, the price of gold rose by Rs 975 for 10 gm compared to the closing price on Tuesday. The price of gold had closed at Rs 23,375 for 10 gm on Tuesday and touched Rs 24,350 in the grey market on Wednesday.
The metal finally closed at Rs 23,955, a rise of Rs 580 over Tuesday’s closing. This is also the record price of gold.
“The main reason for this jump in the price of gold is the US raising the debt ceiling,” said Prithviraj Kothari, president of Bombay Bullion Association (BBA).
He said this (US raising debt ceiling) would increase inflation, which would have a negative impact on the market.
He said other countries were also heavily buying gold and added that all this changes market sentiment.
Confirming that Wednesday witnessed the historic jump, Suresh Hundia, president emeritus, BBA said by Diwali the price would touch Rs25,000 per 10 gm.
Kumar Jain, vice president, Mumbai Jewellers’ Association said South Korea also purchased 25 tonnes (25,000 kg) of gold indicating a worldwide inclination towards stocking of gold to be prepared for any future financial crisis.
“The price will further increase. With such a steep jump in a day, people are flocking to buy gold. I have had 60% more business on Wednesday (following this jump) compared to other days,” said Jain, pointing out that locally too investors were rushing to stock gold.