Wednesday 28 December 2011

Gold and silver touched all-time highs in 2011

Continuing their record-breaking spree, gold and silver galloped to all-time highs in 2011 on strong demand for precious metals considered as a 'safe-haven investment' in times of economic turmoil and rising inflation.




Gold (99.5 per cent purity) crossed the Rs 29,000 per 10 grams-level to a historic high of Rs 29,155 per 10 grams on December 8, 2011, on good local demand in view of the marriage season coupled with investment buying due to weak equity markets. Pure gold (99.9 per cent purity) also logged a fresh peak of Rs 29,280 per 10 grams during the year.

Silver (.999 fineness) prices hit an all-time high of Rs 75,020 per kilogram on April 25, 2011, on heavy speculative and investment-driven buying in line with global markets, where the metal rose to a fresh 31-year high. The metal witnessed a global rally amid speculation of a supply shortage. Furthermore, successful launching of E-silver by the National Spot Exchange Ltd sharply boosted the speculative nature of the metal.

The domestic market witnessed relentless buying in precious metals due to global volatility in view of escalating geo-political tensions across West Asia, the subsequent impact on crude prices, sustained weakness in world equities, higher inflation and concerns over global economic growth. In May, global markets witnessed a free-fall in prices of the precious metals as speculators dumped their long positions after metal exchanges hiked the margin requirement several times.

Silver ready (.999 fineness) was trading at Rs 52,285 per kg on December 27, nearly 11 per cent higher vis-a-vis last year's close of Rs 47,030.00 per kg. Standard gold (99.5 per cent purity) also flared up by about 34 per cent to Rs 27,500 per 10 grams on December 27, 2011, from Rs 20,585 per 10 grams on December 31, 2010. Pure gold (99.9 fineness) was quoted at Rs 27,630 per 10 grams on December 27, 2011, as against Rs 20,680.00 per 10 grams at the end of last year.


Source: www.rediff.com
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