Gold and silver prices today surged in Indian markets, tracking an overnight rally in global rates. On MCX, August gold futures jumped about ₹550 per 10 gram to ₹47,157 per 10 gram. July silver futures on MCX surged about ₹950 to ₹49,014 per 10 gram. Gold prices in India include 12.5% import duty and 3% GST. Last month, gold prices had hit a record high of about ₹48,000 per 10 gram.
In global markets, gold prices rose to a one-week high before giving up gains as bleak economic outlook from the US Federal Reserve boosted demand for the precious metal. Gold is seen as a safe-haven asset in times of economic uncertainty. Fed officials estimate that the economy will shrink 6.5% this year, in line with other forecasts, before expanding 5% in 2021.
Spot gold was down 0.2% at $1,732.56 per ounce, after hitting its highest level since June 2 earlier in the session. Overnight, gold rates in global markets had spiked over 1%. Among other precious metals, silver declined 1.7% to $17.95, while platinum rose 0.5% to $836.38. Overnight, the Federal Reserve signaled that it expects to keep its key short-term interest rate near zero through 2022.
Federal Reserve Chairman Jerome Powell signalled that the central bank will keep pumping stimulus into the U.S. economy until its labor market has healed from the effects of the coronavirus pandemic.
“We are strongly committed to using our tools to do whatever we can for as long as it takes,” Powell said.