Gold Price: From peak of Rs 56,000 in August, gold plunges to near Rs 43,000 | India Business News – Times of India

MUMBAI: After a strong run that had lasted about nine months, gold in India is on a slide with its price during intraday trade on Friday nearing the Rs 43,000-per-10-gram level. From a high of Rs 56,310 recorded in August, the price is now down 21%. This means gold has technically entered the bear territory.
The slide in gold rates here came due to a sharp drop in its price in the international markets, which fell below the $1,700-per-ounce (Oz) mark on Thursday — a nearly nine-month low level.
From its all-time peak at $2,010 last August, it has now lost 15%. Analysts feel that it could slide below the $1,500 level before it stabilises.

The drop in gold prices came on the back of a strong dollar, which was due to the rising bond yields in the world’s largest economy. With investors pouring money into US government bonds to earn higher yields, the attractiveness of the yellow metal as a safe haven diminished a bit, and hence the slide in its price, analysts said.
Apart from demand factor, the price of gold in India depends on the international pricing and the rupee dollar exchange rate since it is a globally traded commodity. Of late, dollar has been strengthening against most major currencies. The rupee-dollar rate has been hovering around the 73-to-adollar mark for the last few months. In the last couple of weeks, the rupee has broken below the 73-mark and on Friday closed at 73.03.
While some analysts see gold sliding to the $1,500 level, others feel there is going to be a tug-of-war between global central banks, which will try to rein in rising yields, and investors who would expect it to rise. This would eventually decide the price of gold, analysts said.
According to Hitesh Jain of Yes Securities, although gold prices have tumbled recently in the wake of the surge in sovereign yields, the latter would not rise sustainably since governments do not favour higher yields on their accumulated gigantic debt.
“There is a prevalent divide between markets and central banks, wherein markets are pricing higher inflation and growth, while central banks remain accommodative and dovish. We assume that central banks will eventually rein in yields with their asset purchases and also help their respective governments in keeping the borrowing costs low,” Jain wrote in a note. “On gold price trajectory, we still remain bullish considering the unprecedented government stimulus, bloated central bank balance sheets and burgeoning sovereign debt.”

This content was originally published here.

Rate:

0 out of 5 stars(0 ratings)

Subscribe to Our Newsletter

money for gold logo

Learn About Buying and Selling Gold for the Best Prices

Get the latest news and expert advice on Gold!

We don’t spam! Read our privacy policy for more info.

Leave a Reply

Related

zeenews.india.com understands that your privacy is important to you and we are committed for being transparent about…

Read more

Sparkles might pose a problem to gentlemen when it comes to watches. Luckily, in watchmaking, there are sparkles, and…

Read more

Gold Price Outlook:Gold Price Drops as Treasury Yields Rise, Will XAU/USD Fall Further?After encountering resistance…

Read more

Share Great Content for Our Resource Section

About

MoneyForGold.com is a resource site created for those looking to sell their personal collection of gold - whether it’s jewelry, coins, bars, antiques, etc., anything made from gold can be sold for quick cash. We encourage visitors to signup and share quality “Money For Gold” resources.

Have a question or comment? Email us at: contact@moneyforgold.com

Navigation
MoneyForGold.com
50% Complete

Learn Where to Sell Your Gold for the Best Prices

Free 3-Minute, Practical Stories Delivered to You Everyday!
Buy, Sell, Invest in Gold Today!