Gold price on Tuesday jumped to Rs 49,450 from Rs 48,960, while the silver price was trending at Rs 73,000 per kg, according to the Good Returns website.
Gold jewellery price varies across India, the second-largest consumer of the metal, due to excise duty, state taxes, and making changes.
In New Delhi, the price of 22-carat gold inched up by Rs 190 to Rs 48,150 per 10 gm, while in Chennai it fell to Rs 46,250. In Mumbai, the rate rose to Rs 48,450, according to the Good Returns website. The price of 24-carat gold in Chennai was Rs 50,450 per 10 gm.
In the international market, Silver stretched its rally to a third session on Monday, jumping as much as 11.2 per cent to a near eight-year high as retail investors switched focus to the metal from GameStop Corp and other stocks hyped up in social media.
As of 2:27 p.m. EST (1927 GMT), spot silver was up 6.6 per cent at $28.78 an ounce, easing back slightly after hitting its highest since February 2013 at $30.03.
Paving the way for a 19 per cent surge in prices since Thursday, posts began circulating on Reddit appealing to small investors to buy silver mining stocks and exchange-traded funds (ETF) backed by physical silver bars.
“This social media speculation is at the early stage for silver and there is uncertainty about how much more momentum we can have,” said Edward Moya, senior market analyst at OANDA, adding that due to positive fundamentals, the addition of new investors will be a longer term positive for silver.
Data from iShares Silver Trust ETF, the largest silver-backed ETF, showed its silver holdings jumped by a record 37 million shares from Thursday to Friday alone, each representing an ounce of silver.
While a lot of people came in “very enthusiastic” that they’re going to see moves in silver similar to what happened with GameStop and other companies, “they now realize there is not as much buying pressure pushing it up like some had thought”, said Michael Matousek, head trader at US Global Investors.
Some of them were lightening up their positioning and that could be responsible for the light pullback, he added.
Spot gold rose 0.8 per cent to $1,860.93 per ounce, while US gold futures settled up 0.7 per cent at $1,863.90.
Experts caution that gold’s relatively subdued performance suggests silver’s rally may not last long. An ounce of gold currently buys 63.6 ounces of silver, compared with 73.3 ounces on Jan. 25.