Gold rate today jumps after ECB rate hike. Will it climb to a new peak?
Gold rate today climb to intraday high of ₹58,277 per 10 gm on MCX and came more close to its record high of ₹58,847 per 10 gm levels
Gold rate today: On account of ease in bank crisis and European Central Bank (ECB) raising interest rate on sixth straight meeting, gold and silver price today ascended in early morning deals. Gold price came further close to its life-time high of ₹58,847 per 10 gm levels and hit intraday high of ₹58,277 levels, around ₹600 per 10 gm away from its record high on Multi Commodity Exchange (MCX).
Gold future contract for the month of April 2023 on MCX today opened upside at ₹58,269 per 10 gm and went on to hit intraday high of ₹58,277 levels. But, profit booking triggered soon and gold price today made intraday low of ₹58,174 per 10 gm.
Silver future contract fro May 2023 on MCX opened higher at ₹67,140 per kg levels and went on to hit intraday high of ₹67,417 per kg levels within few minutes of market opening.
Why gold, silver prices are skyrocketing
On reason for spike in gold and silver rates today, Anuj Gupta, Vice President — Research at IIFL Securities said, “After ECB rate hike, US dollar rate has come under pressure and Dollar Index has slipped below 104 levels. This has provided support to the yellow metal that resulted in strong buying in early morning deals."
Highlighting the ease in bank crisis after Credit Suisse Bank collapse news, Marc Despallieres, Chief Strategy and Trading Officer at Vantage said, “Markets started the day in a better mood, as governments and central banks are taking steps to ensure banks’ credibility and prevent a steeper crisis. Relief came after the Swiss National Bank and the Swiss Financial Market Supervisory Authority announced late Wednesday that Credit Suisse met the capital requirements imposed on banks and that they would provide liquidity if necessary. ECB announced its monetary policy decision which was widely anticipated, the central hiked rates by 50 basis points."
Marc went on to add that Despite Credit Suisse’s turbulence, the European banks are resilient and are much stronger than in 2008 after raising interest rates, stated by President Christine Lagarde.
Gold price outlook
On whether gold prices would climb to a new peak, Anuj Gupta of IIFL Securities said, “Much will depend upon the US Fed's FOMC meeting. If the US Fed officials decided to pause interest rate hike, then in that case US dollar would come under more pressure leading to sharp upside movement in both equity, gold and other bullion metals. In case of no hike in US Fed rates, gold prides may breach its current $1,950 per ounce resistance and go on to climb to its next hurdle of $2,000 levels ( ₹60,000 on MCX)."
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