Gold prices surge on Akshaya Tritiya

Chennai: Gold sales on Akshaya Tritiya day on Friday were dampened by price rise and election-related curbs. However, gold has provided returns of 20.5 per cent for a person who had invested in the metal on the same auspicious day of last year.

Due to the weakness of the US dollar and the gold price rise in the international market on Thursday, domestic prices of the yellow metal surged on Friday. Gold future contract on the Multi Commodity Exchange (MCX) for June 2024 expiry opened higher at Rs 71,730 per 10 gm and touched an intraday high of Rs 72,888 per 10 gm, logging an intraday rise of around Rs 1,200 per 10 gm.

This made buyers restrain their sales to token purchases. “Further, the checks by government authorities on account of elections in different states have affected the movement of the metal. Third-party logistics providers have been facing problems and this has made jewelers go slow with marketing this time,” said Tom Jose, CFO of Joyalukkas.

According to him, sales in volume terms would have been slightly lesser than last year.

However, Saurabh Gadgil of the Indian Bullion and Jewellers Association found that footfalls were high in the morning, though they slowed down in the afternoon. According to him, pre-booking accounted for almost 40 per cent of the sales.

From an investment point of view, the lustre of the metal was bright. Gold prices have appreciated 20.5 per cent since the last Akshaya Tritiya. From Rs 59,845 per 10 gm on the last Akshaya Tritiya on April 22, 2023, prices have gained around Rs 13,000 to touch the intraday high of Rs 72,888 per 10 gm on Friday.

Further, the yellow metal has surged from Rs 31,729 per 10 gm in 2019, increasing by nearly Rs 41,000 per 10 gm rise during the five years.

According to Ajay Kedia, MD, Kedia Commodities, gold prices are expected to move up to Rs 75,000 levels in a month, though there could be corrections owing to profit-booking at higher levels. “The interest rate cut by the US Federal Reserve is likely to provide further support to gold. The geopolitical tensions also improve gold’s prospects as a safe haven asset. The trajectory of the gold price is upward and we expect prices to touch Rs 80,000 per 10 gm by next Akshaya Tritiya,” he said.