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Gold hits 14-month high at Rs 30,560 per 10 gms on dollar's depreciation

The dollar index has fallen over 10 per cent over the past quarter on a growing US economy

Dilip Kumar Jha  |  Mumbai 

Gold

jumped by 0.6 per cent at here to the highest in 14 months, following a global move where depreciation in the dollar prompted consumers to diversify their portfolio from overvalued Standard rose to trade at Rs 30,560 per 10g here in the early session on Thursday, before profit booking it down to Rs 30,445 per 10g at the end of the day. It recorded a gain of Rs 170 from its previous close of Rs 30,275 per 10g. The dollar index has fallen over 10 per cent over the past quarter on a growing US economy.

Many have termed global as “overvalued”, prompting investors to diversify a part of their investment into “The geopolitical climate and potential equity market problems will continue to support gold’s role as a risk hedge. We argued three months ago that there is growing risk in equities and while strength has persisted, we continue to believe that the need to brace themselves for a sharp correction, once the feeding frenzy abates In this event, would also be likely to stage a sharp downward correction due to its role as an insurance or hedge and also in the race for liquidity, although one of the major reasons for this latter has weakened, with the SEC (the US regulator) now applying two days’ settlement for broker-dealer trades, as against t+3 hitherto, although t+3 still applies to a large number of stock Gold’s role as a risk hedge will remain supportive as rising tensions in Europe and a somewhat spontaneous approach from President Trump are raising uncertainty levels,” said Thomson Reuters in its latest report on slithered in early December to a five-month low ahead of a US Federal Reserve meeting when it had announced the intention to raise the funds target rate for the third time in the year. This had been discounted by the and triggered a healthy rally to a year-end close of $1,241 an oz, a 12.5 per cent intra-year gain on route to $1,340 in mid-January. This move was propelled in good part by the replenishment of COMEX long positions that had been sold down ahead of the Fed meeting and covering of shorts. hit $1,365 an oz in the benchmark London trade to hit the highest after August 2016.

First Published: Thu, January 25 2018. 23:01 IST
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