HYDERABAD: The rapidly escalating trade tensions between the US and China propelled gold past the $3,200/ounce mark for the first time on Friday. This in turn also pushed the price of the yellow metal in the domestic market a step closer to the psychologically important Rs 1 lakh/10-gram mark, to Rs 96,000 by Friday evening, a new all-time peak.
The recent surge in the yellow metal in the global and local markets came on the back of a sharp drop after the US president Donald Trump escalated the tariff war with most of the country’s trading partners, raising chances of a recession in the US. In the domestic market gold prices had fallen to Rs 88,200 on Tuesday while in the international market it had dipped below the $3,000 mark.

In Friday’s mid-session on Comex in the US, gold prices had hit a new all-time high at $3,262. The recent recovery in gold prices was driven by renewed demand for safe haven following Trump’s erratic remarks on tariffs, that led to a huge sell-off in global equity and bond markets, weakened the dollar, and raised fears of a global recession, said Saumil Gandhi, senior analyst – commodities, HDFC Securities. “The sharp fall in the dollar index below the 100 level also lifted traders’ sentiment,” he said. Dollar index is a weighted average price of the dollar against eight major currencies. Earlier this year it had run up to 109.6.