Gold prices in India rose on Monday despite a falling trending in the international market, as the rupee weakened. On MCX, gold futures rose nearly 1.5 percent or Rs 579 in morning trade to Rs 40,937 per 10 grams after opening higher at Rs 40,721.
Similarly, silver futures were trading over 1 percent higher at Rs 36,222 per kg.
In the international market, spot gold fell 0.2 percent to $1,494.63 per ounce after rising as much as 3.1 percent in the previous session. Analysts say that the decline the metal's price below the $1,500 level is due to investors' selling gold for cash as equity markets crash after more and more cities go into total lockdown to curb the spread of COVID-19.
Another concern is the possibility of central banks having to sell gold to buy dollars as the American currency was holding its three-year high against major currencies.
The accelerated rush to hoard cash amid worsening global economic crisis has caused dramatic movement in the stock markets.
In India, after Sensex hit a lower circuit of 10 percent and trading was halted for 45 minutes on Monday. Mirroring losses in equities, the Indian rupee slipped to a new all-time low of 76.14 against the dollar, surpassing the 76-mark for the first time ever.
A weaker rupee makes gold expensive for domestic buyers as most of the country's metal needs are met through imports.