In the long term, gold may be regarded as one of the most successful tools against inflation. But in recent months, gold has suffered as global central banks have raised interest rates to combat inflation. However, considering the price fall, analysts think this is the best moment to make gold investments. They anticipate that there will be a further increase in demand for gold, both from investors and consumers. Let's explore the latest gold price trends and India's overall investment scenario.
Gold Investment Outlook in India
India is the world's second-largest consumer, with an average yearly demand of around 800-850 tonnes for gold. 80% of that amount is used for jewellery and the remaining for gold coinage and other industrial applications. The Indian customs consider gold purchases during festivals like Diwali, Dhanteras as auspicious. Hence, gold prices rise during this time.
In the future, despite the high inflation, people will continue to buy gold jewellery because they will think inflation will increase the price of gold too. A person will think of gold today if its price increases. He can use it to take a gold loan when required. Obtaining gold loans is now easier than ever. Investors can also check the monthly instalments they need to pay on a gold loan emi calculator.
Factors Driving Gold Prices in 2024
The following factors are increasing the price of gold in 2024.
The supply and demand can impact the price of gold. Prices rise when there is a greater demand for gold than supply, and vice versa.
Mining is the main source of supply for gold. Mining activities, such as surface mining, underground mining, and placer mining, extract gold from the earth. Both artisanal miners and large-scale mining firms add to the total supply.
Recycled and refined gold jewellery, bars, electronics, and other gold-containing items can produce new gold. To make fresh gold, scrap gold is gathered, melted, and purified.
Several central banks have sizeable gold reserves as part of their foreign exchange reserves. These reserves may be sold or lent to other organisations in order to supply the market with gold.
A portion of central banks' and governments' gold reserves may be sold in the market. These sales can potentially affect the supply as a whole and are subject to different financial and economic tactics.
International commerce contributes to the availability of gold. While importing countries get gold to satisfy internal needs, producing countries sell gold to nations with greater demand.
Gold is often seen as a safe-haven asset. It is preferred in times of economic uncertainty. The price of gold may be influenced by GDP growth, inflation, interest rates, and geopolitical unrest.
Latest Trends in Gold Investments in India
Here's a look at the recent trends and developments in the Indian gold investment landscape.
Gold prices fell in January, ending 1.2% down at US$2,053/oz, after reaching a record closing in 2023. The reasons were capital withdrawals from global ETFs, rising bond rates, and the strength of the US currency.
Due to the relative stability of the Indian rupee, the local gold price also declined. Despite this, the gold's retail price was about INR62,600/10g.2.
After almost three months of trading at a discount, the domestic gold price started to trade at a premium compared to the international price in late January.
The RBI purchased the highest-ever gold in a single month in eighteen months in January.
Over the previous ten months, a steady influx has been into Indian gold ETFs. January witnessed net inflows of US$66.7 million (Rs6.5 billion), the most since August.
How to Tracking Gold Prices?
in India. Here are a few ways to track gold prices :
Online Platforms
Check out reputable websites or applications that offer up-to-date gold prices in real-time. Interactive charts and real-time gold prices are available for both 22 and 24-carat gold on websites such as IIFL Finance.
News Portals
During market hours, business news stations frequently show the live gold rate today. Newspapers' market tracker sections are another place to look. Gold rates are published daily in several publications.
Mobile Apps
To get real-time gold price updates on your phone, download a good app which offer all the updates of the financial market.
Conclusion
The demand for gold jewellery will probably be low for the upcoming few months. If there isn't a big decline in price, demand may grow up in the near future. The current geopolitical and economic conditions are unpredictable throughout the world. So, investors are looking to invest in the domestic markets. This increases the inflows of capital into domestic financial markets. Hence, demand for gold investments is increasing.
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