EVERYTHING beautiful comes at a high price, this saying surely holds true for gold asitsprice has rallied to an all time high of Rs 76,000 per 10 grams in the city jewellery market (without GST).OnSeptember27, the gold prices were quoted at Rs 76,000 per 10 grams, as compared to prices in March at Rs 67,000 per 10 grams. Inaspan of 6 months gold price has run up by Rs 9,000 per 10 grams. “The gold prices are rising at a rapid pace due to high festive and wedding demand across the country. The frenzy of buying gold has started among the people. Walk-ins havesurgedandpeopleinlarge numbers are booking gold in advance so that they can take delivery later on. This is pushing gold prices to higher levels,” said Rajesh Rokde, Director of Rokde Jewellers, Secretary of Nagpur Sarafa Association and Vice Chairman of All India Gem and Jewellery Domestic Council (GJC) while speaking to The Hitavada.

 

Anothermajorcontributor to thestrongriseindemandis the lowering of theimport duty on gold to6 per cent from the earlier 15 per cent by the Government. As a result of this move,buying goldhasbecome more attractive in the country, he pointed out. “The gold prices are expected to touch Rs 85,000 per 10 grams on the back of strong demand by Diwali,” he said. Apart from this, therearevarious other factors that are lifting gold prices in the internationalmarket.Forinstance, the USFederalReservehaslowered the interest rates by 50 bps. Goldpricesrisewhen theinterest rates are at lower levels. Also, there is fear of recession in the US economy which is another reason for the gold prices to spike. Similarly, severalcountriesincludingChina have adopted a policy of dedollarisation that is promoting theirowncurrency for trade. This weakening the US dollarin the international market. Similarly, Central banks arebuying gold in bulk quantitiestostabiliseandstrengthen theircurrencies.

 

Thegoldpricesriseduring time of war and otherdangerous conflicts in variousparts of the world like RussiaUkraine apartfrom tensionsinthe Middle-East. All these factorsaremajorcontributors thatare pushing gold prices higher, Rokde added. Kishor Sheth, Director of Batukbhai and Sons Jewellerssaid that gold prices are creating history due to strongdemand in the market. It isseen that gold prices tend torisewheninterestratesarelower.Also, theIndianGovernmentrecently slashed the import dutyongold to6percent,compared to earlier 15 per cent. “This has had a positive affecton the demand for gold tosurge,” he said.