Surge in gold prices

NUCLEAR ASIA

The nuclear test by North Korea and the decision by Organisation of Petroleum Exporting Countries (OPEC) to cut production by 3.5 per cent led to a surge of Rs 115 per 10 gm in domestic gold price.

Standard gold in Mumbai closed at Rs 8,635 per 10 gm as against Friday's close of Rs 8,520. Even silver closed at Rs 18,155 per kg, a high of Rs 375 over Friday's close.

OPEC has decided to cut crude oil output by one million barrels a day to check the crude oil price that has been declining over last two months.

Analysts expect gold to cross the Rs 9,000 per 10 gm mark before Diwali, mainly on account of geopolitical tensions and recovery in crude oil price.

Apart from the North Korea issue, even Iran has refused to halt its nuclear enrichment programme despite threats of sanctions.

"There is no reason for gold or silver price to decline as the crude oil price is seeing a recovery. Oil and gold prices have been tracking each other since past three months and once gold touches the Rs 8,850 mark, it would comfortably cross Rs 9,000," said a Karvy analyst.