Gold price dips below Rs 29,000-mark, crashes Rs 400 to 2-month low

New Delhi: Gold prices saw a sharp downturn Friday, plunging as much as Rs 400 to an over 2-month low of Rs 28,850 per 10 grams, hurt by a sluggish overseas trend and lower demand from jewellers.

Silver also slipped below the Rs 41,000-mark by falling Rs 525 to Rs 40,975 per kg on reduced offtake by industrial units and coin makers.

Traders said that other than the weakness in demand, a higher probability of a rate hike by the US Federal Reserve next week and a general diminishing of appeal for precious metals as a safe haven hit gold hard.

Globally, the yellow metal fell 0.4 percent to USD 1,196.24 an ounce, the lowest since January 31 in Singapore.

Besides, a drop in demand from local jewellers and retailers at domestic spot market fuelled the downtrend.

In the national capital, gold of 99.9 percent and 99.5 percent purity tumbled by Rs 400 each to Rs 28,850 and Rs 28,700 per 10 grams, the lowest since January 7. It had lost Rs 850 in the last four days.

Sovereign, however, held steady at Rs 24,300 per piece of eight grams.

In line with gold, silver ready drifted lower by Rs 525 to Rs 40,975 per kg and weekly-based delivery by Rs 375 to Rs 40,780 per kg.

Silver coins, however, held steady at Rs 70,000 for buying and Rs 71,000 for selling of 100 pieces.