Gold prices soar to 7-month high

Gold prices have been rising in the international market on the back of depreciating US dollar and falling bond yields

Mumbai: Gold prices increased to a seven-month high in the international market on Wednesday while in India gold prices were above Rs 62,500 per 10 gm for 24 carat gold.

Gold prices have been rising in the international market on the back of depreciating US dollar and falling bond yields. There also growing expectations that the Federal Reserve is likely to cut rates in the coming months.

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Spot gold rose 0.24 per cent to cross the $2,046 per ounce by 11.30 a.m. on Wednesday morning, which is the highest price since May 5. US gold futures for December delivery rose 0.3 per cent to $2,045.40 per ounce. Gold prices have now risen by close to 10 per cent from the beginning of the year.

Gold prices varied across different cities in India. Chennai recorded the highest price of 10 gm of 24 carat gold at Rs 63,050 while in Delhi and Mumbai the prices were Rs 62,710 and Rs 62,560, respectively. Gold prices have been rising in the global market as the dollar has continued to depreciate against a basket of major currencies and is currently close to a three-month low which makes gold cheaper to buy in other foreign currencies.

Expectations of low interest rates makes financial instruments less attractive for investors compared to gold which is considered a safe investment. 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.