Gold prices in Indian soared today as global rates spiked after a senior Iranian military official was killed in a US air strike. On MCX, February gold futures surged 2% or ₹781 to ₹40,058 per 10 gram. Over the past two weeks, gold prices in India have surged about ₹2,000 per 10 gram, tracking a jump in global prices and a depreciation of the rupee against US dollar. Silver prices also rallied today in global markets, continuing their recent gains. Silver futures on MCX gained 1.6% or ₹750 to ₹47,765 per kg.
In global markets, spot gold prices today rose 1% to $1,543.66 per ounce amid tensions in the Middle East. Iranian Major-General Qassem Soleimani, head of the elite Quds Force, and top Iraqi militia commander Abu Mahdi al-Muhandis were killed in the air strike on their convoy at Baghdad airport, the Pentagon said. Gold is considered to be a safe investment at time of political and economic uncertainties.
Investment demand in gold has also picked up in recent days. Holdings of the world’s largest gold-backed exchange-traded fund, SPDR Gold Trust, rose to over 1-month high of 895.30 tonnes on Thursday.
The Indian rupee today fell to 71.77 against the US dollar as oil prices rose sharply amid geopolitical tensions in the Middle East. India imports most of its gold requirements. Gold prices in India include 12.5% import duty and 3% GST.
Among other precious metals, silver rose 0.5% to $18.11 per ounce, while platinum gained 0.3% to $981.43. Palladium climbed 0.3% to $1,964.87 per ounce.
Gold traders are now await the minutes of the US Federal Reserve’s December 10-11 policy meeting, due later today. Lower interest rates reduce the opportunity cost of holding non-yielding gold.