Gold prices touched an all-time high of Rs 19,405 per 10 gm in the Indian spot market, as international prices climbed a two-month high of $1,254.28.

In domestic market, prices rose by Rs 185 from the previous record level of Rs 19,220 set on June 8.

In the international market, prices gained 0.6 per cent on Wednesday to advance near its all-time high of $1,264.90 an ounce (oz) during June. At MCX, October contract saw a high of Rs 19,158 per 10 gm, whereas at Comex it moved up to $1,255.30.

The weakness in dollar increased buying by most of the gold funds, which resulted in a spurt in prices.

US dollar slipped near its two-week low against euro and was lower than pound sterling. It was also lingering near its 15-year low against yen. During the past few quarters, however, gold has been chasing the euro.

Holdings of SPDR Gold Trust moved up to 1,302.51 tonnes from 1,298.56 tonnes. SPDR’s holdings advanced to a record high of 1,320.44 tonnes on June 30.

According to Harish Gallipellli, head (currency derivatives commodity research) of JRG Wealth Management, seasonal buying in the later part of the year usually triggers price movements.

“Historically from September to December, prices remain high due to festival buying. Prices of the metal have risen for 17 out of 21 Septembers since the year 1989. In addition, gold prices are already on a bull trend that complements the seasonal behaviour of the metal. Western economic concerns have contributed significantly towards safe haven buying of the metal and China, the second biggest consumer of gold,” he said.

Gallipelli expects gold prices to move to $1,300-$1,320 in the calendar year.

sangeethag

@mydigitalfc.com