After record subscription in April, second tranche of sovereign gold bond opens today

The second tranche of Sovereign Gold Bond Scheme for FY21 will open for subscription on May 11. The bonds are issued by the Reserve Bank of India (RBI) on behalf of the government.

Series II of sovereign gold bond scheme 2020-21 will close for subscription on May 15, RBI notified in a circular dated May 8.

The nominal value of the bond has been fixed at Rs 4,590 per gram while the issue date is May 19. Those applying online and making payment through digital mode will get a discount of Rs 50 per gram at Rs 4,540 per gram of gold, the RBI said.

In the wake of rising demand for the yellow metal, the first tranche of sovereign gold bond for this fiscal issued in April saw a record subscription of 17.73 lakh units worth Rs 822 crore.

In April, gold futures prices on MCX had surged to record high above Rs 47,000 per 10 gram. Fears of a deep global recession amid the lockdowns due to COVID-19 and monetary debasement by central banks has shifted investors' focus to the safe-haven appeal of the yellow metal. The gold futures are up more than 11 percent on a year-to-date basis.

Brokerages expect the bullion to continue on its upward trajectory.

Kunal Shah, Head - Commodity Research at Nirmal Bang underscore that gold has already outperformed all asset class and it is likely to be one of the best investment options as massive monetary debasement by Western Central Banks and the looming uncertainties over the health of the global economy may add more glitter of Gold.