Mumbai, Dec 21 (IANS): Prices of precious metals rose on Monday, with futures of silver surging over 3 per cent on the Multi-Commodity Exchange (MCX).

The March contract of silver on the MCX is currently trading at Rs 70,479, higher by Rs 2,572 or 3.79 per cent from its previous close.

Gold futures on the MCX also rose and crossed Rs 51,000 per 10 gram level before shedding the gains. The February contract of gold was trading at Rs 50,785, higher by Rs 481 or 0.96 per cent from its previous close.

Speaking to IANS, Anuj Gupta, DVP, Commodities and Currencies Research, Angel Broking, said that the expectation of a stimulus package in the US and prospective lockdowns in several countries, including Germany, have lifted the prices of gold and silver.

"Expectation of stimulus package will also support the gold and silver price. Several major economies, including Germany, will be going in for lockdowns again due to coronavirus pandemic. This is supporting gold and silver as a saleable asset," he said.

He noted that prices of the precious metals both in the international and domestic markets are likely to rise further in the near term. "We expect gold may test the $1,920 level soon," he added.

Inflation risk and a low interest rate environment has increased the demand for gold in 2020 as it is considered as a hedge, Gupta said.