Mumbai: The active gold contract on MCX hit a record high of Rs 50,020 per 10 gm in morning trade as investment demand for precious metal rose amid uncertainty around the global pandemic and the US-China trade war.
“The US Fed has given a huge amount of fiscal stimulus which is weakening the dollar and helping dollar-denominated assets like gold,” said Rajesh Palviya, technical head, Axis Securities.
Gold in India tracks the international rate as India imports almost the whole of its requirement. Prices internationally are away from the record high of $1911 an ounce hit in August 2011. However, the rupee price of the precious metal is at a record high because of the weakening of rupee to the dollar over the years.
In India, investors are flocking to sovereign gold bonds, which in the fourth tranche saw over 4 tonnes of gold equivalent being subscribed while gold ETFs run by mutual funds are also seeing net inflows after many years.
In June, the net inflow was Rs 494.23 crore while net assets under management as on June end were at Rs 10,857 crore.