Gold jumps Rs 4,800 and silver Rs 9,000 in Delhi ahead of Dhanteras

Gold and silver prices jumped sharply in Delhi's bullion market on Wednesday, just ahead of Dhanteras. Higher demand in the festival season and strength in precious metals in global markets were clearly reflected in domestic prices.

According to the All India Sarafa Association, 99.9 per cent pure gold rose by Rs 4,800 to Rs 1,46,600 per 10 grams in Delhi on Wednesday. On Tuesday, the same gold was at Rs 1,41,800 per 10 grams.

Silver did not lag behind. It climbed Rs 9,000 to Rs 1.93 lakh per kg on Wednesday, after closing at Rs 1.84 lakh per kg on Tuesday.

Saumil Gandhi, senior analyst (commodities) at HDFC Securities, said gold and silver prices rose on Wednesday because of a strong recovery in the international market and increased festive-season demand in the domestic market.

According to Rajeev Sharan, head of research at Brickwork Ratings, gold prices had fallen about 8 per cent from their October peak. He said gold had recently slipped because of a stronger US dollar, a rise in bond yields and fading expectations of interest rate cuts by the US Federal Reserve. This led traders to book profits.

Sharan also said gold's gain this Dhanteras has been smaller than last year's. Gold has risen only 5 to 7 per cent since the last festive season, whereas at the last Dhanteras its price had risen by about 65 per cent year on year.

Prices were also higher in the international market. Spot gold rose $113.72, or 3 per cent, to $4,043.93 per ounce, crossing the $4,000 mark once again. Silver rose 4.5 per cent to $52.03 per ounce.

Praveen Singh, commodities head at Mirae Asset Sharekhan, said the dollar weakened after the Democratic Party's win in the US midterm elections, which supported precious metals.