Gold prices soar to historic high of INR 66,778 per 10 gram

MUMBAI — Gold prices jumped to a historic high of INR 66,778 per 10 grams on the MCX in morning trade on Thursday following the US Federal Reserve maintaining its outlook for a soft money policy with at least three rate cuts this year.

Prices of the precious metal rose by INR 1,028 per over the previous day’s closing which works out to a nearly 1.5 per cent increase.

In the international market, gold prices soared past $2,200 an ounce for the first time in opening trade. Spot gold rose 0.7 per cent to $2,201.94 an ounce at 9:40 a.m. in Singapore.

Expectations of low interest rates makes financial instruments less attractive for investors compared to gold leading to increased purchases of the yellow metal and the rise in prices.

Rising geopolitical risks and buying by central banks, led by China have also fuelled gold prices.

With no end to sight in the Russia-Ukraine war and the Israel-Hamas conflict spreading to the Red Sea region, gold is seen as an attractive safe haven asset by investors.

The demand for gold in the domestic market remains firm amid the marriage season as the precious metal is gifted to brides and grooms in large quantities.