July 28, 2020 (MLN): Gold touched its highest before the price rally led to profit-taking. Gold inched lower on Tuesday to clock in at $1915 per ounce, which helped dollar respite.
In a volatile trade, the yellow metal reached $1980 an ounce, marked an all-time record, beating out the previous apex, reached in 2011 amid escalating tension between Beijing and Washington and virus uncertainty, however, a wave of selling pushed it back to $1915.
This bullish trend was mainly attributable to the greenback at the weakness and massive liquidity pumped by central banks across the globe.
A recent article in an American-based magazine – Forbes- titled ‘Stay the Hell away from Gold’ has given a piece of incisive investing advice.
The caption itself speaks volumes. The article suggests that as a long-term investor, portfolio investment is better. Gold is a problematic holding as it is notoriously volatile.
It is pertinent to mention that the record hit nine years ago was during another fraught time – in the aftermath of the financial crisis. Then, the new threat of the European sovereign debt mess seemed to trap the world again in the economic quagmire, the writer mentioned.
The article highlighted that this uptrend is going to continue if two malign forces- economic downturns and political turmoil keep battering us. As soon as this volatility passes, the period of healing starts, gold will fall like the rock it is. It happened after the sovereign debt crisis when gold lost more than 40% of its value. That seems like a bit of gamble.
‘In the fullness of time, investing in this precious metal is buying fool’s gold’, the article said.
On the domestic front, breaking its ninth-day streak, the price of 24 Karat-Gold plunged by Rs 1300 to Rs 122,500 per tola in line with the global market. The valuable yellow metal had closed at Rs 123,800 per tola on the previous trading day.
Similarly, the price of 10-gram gold declined by Rs 1,114 to clock in at Rs 105,024 against Rs 106,138 on the last trading day.
On the other hand, the demand for silver remained stable. According to the Karachi Sarafa Association, the 24 Karat- Silver remained stagnant at Rs 1,500 per tola. Moreover, 10-gram silver stood at Rs 1,286.
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