Gold prices rose on the first day of Diwali festival "Dhanteras", recovering by 40% by noon Friday from the $100 drop seen last week as hopes fade that a vaccine will end the pandemic anytime soon, leading to a decline in global stock markets.
The price of gold recorded $1895 an ounce, as the US currency fell in the foreign exchange market. In New Delhi, the 24-karat rose to INR 53,620 per 10 grams , and in Chennai it stood at INR 51,930.
"The festival usually marks the second highest gold-buying season in the world after the Chinese New Year," the Confederation of India Traders (CAIT) said, adding that there is indeed a drop in the purchasing power due to the pandemic.
"Gold has recovered as COVID cases are still on the rise worldwide. Market optimism about the vaccine and risk sentiment are gradually faded," said Xiao Fu, Bank of China Analyst.
The U.S. 10-year bond yields fell on Friday to 0.87% , the lowest in 6 trading days and matching their level when gold prices began to spike sharply in August at $2,075 an ounce.
Meanwhile, silver also recovered reaching $24.75 an ounce on Friday.
Follow the latest news on Google News
