Riding high on the oil and farm commodities rally, gold hit an all-time high today. In Mumbai, the precious metal opened at a new peak of Rs 12,195 adding Rs 190; in Delhi it added Rs 175 to Rs 12,215. While in Chennai the prices surged by Rs 200 to at Rs 12,130, in Kolkata it opened at last closing level of Rs 12,225 per 10 gram.Noting that it is the major macroeconomic factors that are impacting gold prices at the moment, World Gold Council managing director (India) Ajay Mitra said, “Internationally, oil is now trading at around the $100 mark, leading to greater inflationary pressures and playing to gold’s inflation hedge characteristics. The continued dollar weakness and recent writedowns in the financial sector, coupled with poor results announcements by the world’s major banks, have extended the credit squeeze. Investors have continued to look to gold, due to its proven safe haven and inflation and dollar hedge characteristics, helping to spur further price movements.”In the last year, gold has surged almost 26 per cent, from Rs 9,700 in February 2007 to Rs 12,217 now. Gold prices exhibited a lot of volatility in the last quarter (Oct-Dec 07). After breaching the psychological mark of Rs 10,000 in November, it took just a little over a month to jump from the Rs 11,000 to Rs 12,000 mark. Commenting on the upward stride, gold analyst Bahrgava Vaidya did not rule out the possibility of a correction. “Gold prices are very volatile right now and, hence, a correction cannot be ruled out. We expect prices to stabilise in the next 10-15 days.”
