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India Silver Seen Breaching Rs 40,000 to Record |
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MUMBAI: India silver futures are likely to hit another record this month and breach the keenly-watched Rs 40,000 per kg mark, on the back of rally in gold prices, and rising physical demand, analysts said.
"The long-awaited breakout in silver prices has offered an extremely positive sign to silver bulls," said Aurobinda Prasad, head of research, Karvy Comtrade.
The most-traded December silver contract on the Multi Commodity Exchange (MCX) was trading 0.44 percent higher at 39,538 rupees per kg at 4:25 p.m., after hitting a contract high of 39,762 rupees earlier in the day.
"I am expecting Rs 40,000 this month, we have seen a bullish flat breakout in spot silver," said Arun Kumar Ubbara, technical analyst with Way 2 Wealth Securities .
Silver may trade in the range of Rs 38,600-Rs 42,000, said Ubbara.
The rally in gold prices is on the back of growing inflation concerns, stoked by the US Federal Reserves' latest move of resuming government bond buying.
Consumers in the rural areas have taken interest for silver, often dubbed as a poor cousin to gold, reflected by a rebound in sales of coins in the recently concluded festivals of Dhanteras and Diwali.
"India's appetite for silver has also been boosted because of higher gold prices," said Karvy's Prasad.
MMTC, the second biggest importer of bullion, said in an interview in September, they could raise silver imports to 1,500-1,900 tonnes in 2010, up from 700 tonnes in 2009, as steep gold prices trigger demand for the less costly white metal.
Source : economictimes.indiatimes.com
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