Gold prices extend gains, now at 3-month high

New Delhi: Gold's two-week winning run continued as its prices surged Rs 245 to a three-month high of Rs 27,425 per 10 grams at the bullion market on August 22, driven by a firming global trend and heavy buying by jewellers to meet wedding season demand. Silver also gained Rs 100 to Rs 36,600 per kg due to increased offtake by industrial units and coin makers.

Bullion traders said besides a firming trend overseas where gold recorded its biggest rally in seven months, brisk buying by jewellers to meet rising seasonal demand mainly lifted gold prices to almost a three-month high.

Globally, gold in New York, which normally sets price trend on the domestic front, gained 0.6 per cent to USD 1,159.60 an ounce in yesterday's trade. Prices rallied 4.2 per cent this week, the most since January 16. Declines across global equity markets spurred demand for the yellow metal as a safe haven.

In addition, a depreciating rupee against the dollar, making imports expensive, also supported the upward movement in gold prices, they said. In the national capital, gold of 99.9 per cent and 99.5 per cent purity surged Rs 245 each to Rs 27,425 and Rs 27,275 per 10 grams, respectively, a level last seen on May 26.

The precious metal had gained Rs 2,200 in previous 12 days. The sovereign, however, held steady at Rs 22,600 per piece of eight grams. Silver ready rose further by Rs 100 to Rs 36,600 per kg and weekly-based delivery by Rs 15 to Rs 36,200 per kg. On the other hand, price of silver coins for 100 pieces was unchanged at Rs 52,000 for buying and Rs 53,000 for selling.