Experts are seeing fresh support for gold prices leading it towards all-time highs in the international markets, even as an escalation of the trade-war between the two largest economies, US and China, saw the price of the yellow metal rally 700-800 points last week.

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Gold rose over 2 percent to a six-year high of $1,537 on the Comex in New York on Friday.

Kotak Commodities head Ravindra Rao says he won't be surprised if spot gold prices shoot past the $1,950 per troy ounce level to log fresh all-time highs.

"Gold prices are indicating that the global worries are still intact. This worry has started since last 2-3 years, now that is escalating. If we compare gold with S&P and gold with bond yield, still the ratio is very low, so gold has a lot of steam left to go much higher," Rao said.

He emphasised that gold's next bull cycle is underway which might see other asset classes, mainly equities, get suppressed.

Indian markets have already seen several highs since the US Federal Reserve announced a cut in policy rate earlier in the month.

Gold futures prices on the MCX gained sharply on Friday to touch record levels of Rs 38,821 per 10 gram.

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"In a month or so we can see gold per 10 grams soar to Rs 40,000-41,000 but if the rupee does not support then it might not," Rao said.

Gold prices are also gaining owing to the weakness of the rupee.

"Indian markets are getting support even from the depreciating rupee, apart from the global uncertainties. The Indian markets are getting a boost from the international prices, as well as the rupee," Rao said.

Owing to the measures for economic revival announced by Finance Minister Nirmala Sitharaman on Friday, some street participants are expecting a strong relief rally in the currency and equity markets, primarily owing to the announcement on the rolling back of the controversial tax surcharge on foreign portfolio investors (FPIs).

According to commodity analysts gold becomes a safe haven whenever there is uncertainty in global markets, and currently it is also the dollar as the US economy is performing better compared to others.

So the "safe haven" money is going into the US currency and gold, an analyst said.

The trend in other precious metals has not been anything like gold. Silver has not seen such sharp uptrend owing to the fact that silver has 60 percent industrial metal properties.

"Silver does not catch-up with gold in case of uncertainty but sometimes follows the base metal, and base metals are trading on a weak note. Base metals, like copper, lead, aluminium and zinc, are all economically sensitive commodities which have fallen owing to the tension between US and China", Rao said.

"Silver has moved up but not like gold. We feel that silver might out-perform because of the gold-silver ratio when we see how far gold prices have gone higher when compared to silver. This ratio has reached a historical high now, so silver might shoot up anytime," he added.

According to analysts, while silver has more potential as compared to gold, at a time of uncertainties, gold is the first to react and silver follows.

First Published:Aug 26, 2019 1:04 PM IST