The prices of gold continue to fall in India markets days before Diwali. On Wednesday, gold futures fell 0.15% to Rs 50,425 per 10 gram while silver futures declined 0.35% to Rs 62,832 per kg.
This is the second day of fall in gold prices in three days.
In international markets, gold prices edged higher on Wednesday, supported by a softer dollar, while concerns about surging Covid-19 cases in the United States and logistical challenges over the mass rollout of a potential vaccine further bolstered the metal’s appeal.
There is enthusiasm int he markets over the announcement made by pharma major Pfizer about a potential Covid-19 vaccine.
Spot gold had fallen 4.6% on Monday, its biggest daily fall since August 11, after Pfizer said its Covid-19 vaccine was more than 90% effective based on initial trial results, boosting risk appetite. In August, gold had hit a record high of Rs 56,200.
However, the breakthrough has brought to light the logistical challenges of distributing hundreds of millions of doses once it becomes available.
“On reflection, the question marks about the production, distribution and actual performance of the vaccine were enough to convince investors that in the short term, central banks and governments are likely to keep fiscal and monetary policies uber-easy,” ANZ (Australia and New Zealand Banking Group) said in a note.
Gold, which has risen 24% so far this year, is considered a hedge against inflation and currency debasement amid the unprecedented levels of stimulus globally.
(With inputs from agencies)