Jewellers in the state expect gold to touch Rs 50,000 per 10 gram after prices surged last week, reports Team B&C
Gold is glittering in the New Year with price touching a new high of Rs 42,095 per 10 gram for 24-carat purity in Mumbai bullion market during the week. The sudden spike came on January 3 when the price shot up to Rs 41,270 per 10 gram on January 2 and further Rs 42,095 per 10 gram on January 8. Since then gold price is eased somewhat due to profit booking but the overall trend is firm.
In Goa, jewellers expect gold price to increase further. The new benchmark is Rs 50,000 per 10 gram as the global situation continues to be volatile, said a jeweller. As per reports geopolitical tensions are unlikely to subside soon and so gold rate will continue to rule high.
The killing of Iran’s General Qassem Soleimani last week by the United States spurred investors to rush towards safety assets such as gold . The precious metal always benefits during times of political and economic uncertainty, as per expert opinion. Meantime fears are of a trade war between the US and China. Tensions between the two countries have been simmering for some time. Analysts from Kotak Securities said, “Any statement coming from US or Iran will be closely watched and will affect the general risk sentiment.”
Next on gold traders’ radar: ‘Phase 1’ trade deal signing between Washington and Beijing, scheduled next week. Analysts say gold prices on the downside will be supported by global growth concerns and Fed’s stance to keep interest rate steady throughout 2020. “Geopolitical tensions are unlikely to subside so soon however lack of any fresh measures has helped eased market nerves to some extent,”
Current surge in gold prices is more of anticipation of what could happen or what might happen (between U.S. and Iran), which is now reflected in the market. Basically the uncertainty that we don’t know what is going to happen,” said an analyst from an international brokerage.
Gold price surge is shocking but the sentiment towards it remains unchanged, said a local jeweler.
He pointed out that, gold jewellery has sentimental value and purchases are mandatory during festivals and weddings. “It is unfortunate that the price rise is in the peak wedding season,” he said.
All of gold consumed by jewelers in India is imported. India is the world’s largest importer of gold, with annual consumption at 800-900 tonnes. Gold imports in the first quarter of the current fiscal 2019-20 increased 35.5 per cent from a year ago to US $11.45 billion, as per official data.