Gold Price Today: Why Did Gold Prices Rise Again While Silver Fell Rs 5,000 In Delhi?

Gold prices rose for the second straight session, gaining Rs 500 to Rs 1,49,800 per 10 grams in Delhi on Thursday, supported by a weaker rupee and firm global prices. Silver, however, fell Rs 5,000 to Rs 2.27 lakh per kg.

Gold rises Rs 500, silver falls Rs 5,000 in Delhi

Gold prices continued their recovery on Thursday, rising for the second session in a row in the national capital. A weaker rupee and a firm trend in international markets supported the yellow metal.

Gold of 99.9 per cent purity rose Rs 500 to Rs 1,49,800 per 10 grams, inclusive of all taxes, according to local traders. It had closed at Rs 1,49,300 per 10 grams on Wednesday.

The rise came a day after gold had gained Rs 700 from its two-month low.

Silver price falls Rs 5,000

Silver moved in the opposite direction on Thursday.

The precious metal declined by Rs 5,000 to Rs 2.27 lakh per kilogram, inclusive of all taxes. It had closed at Rs 2.32 lakh per kg in the previous session.

Despite gold's two-day recovery, the metal remained lower for the week. Gold has fallen Rs 2,800, or nearly 2 per cent, this week.

Silver has seen a sharper weekly decline, losing Rs 10,000, or around 4.2 per cent.

Rupee weakness supports gold

One factor supporting domestic gold prices was the fall in the Indian rupee.

The rupee slipped below the Rs 96-per-dollar level on Thursday and closed at 96.31 against the US dollar. This was its weakest closing level in more than two months.

A weaker rupee can support domestic gold prices because the metal is largely imported and becomes more expensive in rupee terms when the currency loses value.

Gold also found support from softer US inflation data, which reduced expectations of a rate hike by the US Federal Reserve, according to Gaurav Garg, Head of Research at brokerage platform Lemonn.

Global gold prices also rise

International gold prices remained firm on Thursday.

Spot gold rose USD 11.94, or 0.29 per cent, to USD 4,169.06 per ounce. Silver also gained nearly 1 per cent globally, trading around USD 60.79 per ounce.

Praveen Singh, Head of Commodities at Mirae Asset Sharekhan, said gold moved higher after softer inflation data, although the rise was limited by higher oil prices and continuing uncertainty around the Strait of Hormuz.

The recent movement in gold has come after the metal fell sharply through the week before recovering over the past two sessions.

US data, Fed comments in focus

Market participants are now watching upcoming US economic data for clues about the Federal Reserve's monetary policy.

Saumil Gandhi, Senior Analyst - Commodities at HDFC Securities, said investors would focus on the US ISM Manufacturing PMI, weekly jobless claims and comments from Federal Reserve officials.

These indicators could influence expectations around US interest rates and, in turn, global gold prices.

Bullion markets in India will remain closed on Friday, October 2, on account of Gandhi Jayanti.

Gold had also gained on Wednesday as traders returned to the market to buy at lower levels after its recent decline. Silver, meanwhile, remained unchanged at Rs 2.32 lakh per kg on Wednesday.

(With inputs from agencies)