Bullions Updates - “ Glory for Gold Amid Flight To Safety “

Bullions Tips - Gold futures soared by more than 5 per cent in the domestic market on Thursday, whilst marking their best performance in seven years overseas, as investors, scarred by the prospects of dwindling global growth, doubting global central banks’ ability to prop up a fading recovery, shunned risky assets, seeking shelter in the safety of the yellow metal.

An ongoing oil price collapse, worries over a China slowdown and renewed fears over the health of the US economy have hit risk taking appetite, pushing global stock markets on the brink of a bear market, bolstering the safe haven appeal of the bullion.
 

Global stocks sank on Thursday as Fed Chair Janet Yellen warned over the risks posed by the worsening financial market turbulence on the US economic outlook, conceding that the world’s top central bank is toying with the idea of negative interest rates as a policy tool as recession fears mount. Yellen’s remarks that the Fed may push back the timetable for further interest rate hikes have bolstered the lure for gold as a store of value.
 

Gold in the international market was also supported by a weaker dollar which bolstered the appeal of the precious metal as an alternative asset. Weaker greenback makes the bullion cheaper for those holding other currencies, thus bolstering demand.
 

Gold may extend gains today as turmoil in equities bolsters the bullion’s safe haven demand. At the MCX, Gold futures for April 2016 contract closed at Rs per 29,791 10 gram, up by 5.2 per cent after opening at Rs 28,350, against the previous closing price of Rs 28,317. It touched the intra-day high of Rs 30,095