Gold hits a record Rs32,933 per 10 gm as rupee nosedives

Gold prices hit an all-time high of Rs32,933 per 10 gm today on sustained buying amidst a record fall of the value of the rupee to 66.07 a dollar.

Gold gained further ground as jewellers and stockists enlarged their positions in line with a firming trend in gold prices overseas.

In Mumbai, standard gold hit lifetime high following a sharp depreciation in the rupee against the dollar.

Gold price jumped by 2.58 per cent or Rs820 to surpass its previous record of Rs32,500 per 10 gm set on 26 November last year and hit a new all-time high of Rs32,585 per 10 gm.

Spot silver also gained 3.54 per cent to close at Rs56,670 a kg, the level not seen after 18 February.

Analysts expect gold prices, which have surpassed the previous high of Rs32,464 per 10 gm, to touch Rs35,000 per 10 gm as the rupee continues its tumble.

In overseas markets, however, gold is facing resistance with dollar gaining strength. On the COMEX, gold hovered around $1,425 an ounce.

In the domestic market, the yellow metal is currently 29.67 per cent above its recent low of Rs25,130, hit on 26 June.

The spike in domestic gold prices also owe to the battering of the rupee and the hike in import duties announced by the government, which is looking at ways to reduce the country's widening current account deficit.

Trading volumes were lower with the continued rise in gold prices. Trading volume on the MCX plunged 60 per cent from Rs23,050 crore hit on 28 June to Rs9,241 crore on 23 August. Similarly, open interest has declined by 9.73 per cent from 15,507 lots to 13,998 lots.