Gold hits four-week high at Rs 9290

Gathering support from the recent oil gains, following the fresh inflow of speculative and hedge funds, gold prices soared to nearly a four-week high in the domestic as well as the international market. The yellow metal is again inching towards the Rs 10,000 mark.

In what has been the fourth consecutive upward movement, standard gold on Monday gained Rs 85 to touch a high of Rs 9,290 in a thin trade in Mumbai's Zaveri market, gaining an overall Rs 500 in the last four trading days.

Experts believe gold is gathering support from oil prices and the trend is expected to continue in near the future.

The uptrend seen in New York on Friday continued to be reflected in the domestic market on Monday.

"Although the trend is bullish, the real picture would be seen only on Wednesday when all markets open," Bhargav Vaidya of B N Vaidya & Associates said.

Although the domestic market is seeing a low demand because of the monsoon and there is slow festival demand, Vaidya believes gold prices may touch Rs 10,000 in this fortnight, if the current trend of speculative and fund buying continues.

"Gold is still benefiting from the rally late last week, resulting from a less hawkish Fed statement and the accompanying dollar weakness," a Barclays Capital report said, adding volatile conditions would be seen in the third quarter. Largely sideways trading, and possibly a clear upward trend may be witnessed sometime in the fourth quarter, the report said.

Spot gold hit a high of $620.50 an ounce before easing to $619.35-620.35 in early trade on Monday in New York, up from $612.60-613.60 levels last quoted on Friday.

It gained more than 3 per cent in the US market at the end of last week as the dollar weakened when tame inflation data backed up the expectations that the Federal Reserve may have arrived at the end of its two-year campaign of tightening monetary policy.