Covid Impact: Gold Prices Continue To Fall Silver Rates Also Crash


The continuing lockdown due to the coronavirus has taken its toll on the Gold market in India as the physical trading of gold has come to a standstill due to the 21-day lockdown. Massive discounts are being offered over international prices, according to Reuters. Last week, discounts rose to their highest since mid-September, at $48 an ounce. The domestic price includes a 12.5% import tax and 3% GST.

Gold prices fell sharply in India today with June futures on MCX falling 0.6% to ₹43,302 per 10 gram, extending losses to the second session. Silver took a beating with May futures crashing 3% to ₹39,758 per kg. Gold rates in India had surged sharply last week rising about ₹3,000 per 10 gram in tandem with a rally in global rates.

As the fears of deepening of economic damage due coronavirus gained traction the gold prices moved higher in the global markets.
Spot gold was up 0.3% at $1,621.85 per ounce. A weak dollar also helped lift gold demand, making bullion cheaper for investors holding other currencies.

A recession warning by the IMF on Friday and exhorting the countries with ‘everything-on-the-table’ response with “massive” spending to avoid a cascade of bankruptcies.

The holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose 1.17% to 964.66 tonnes on Friday.

In India, the Gold market remained wary about a supply squeeze following a sharp divergence in London and New York prices, as the coronavirus closed precious metals refineries.