According to the World Gold Council, India’s demand for the yellow metal went up by 14 per cent in the July-September quarter, which also included the month from Navratri to Dhanteras, when Indians buy it as a tradition. But with festivities behind us, gold’s glitter can fade in the next couple of months, as rural demand will be bogged down by inflation. With headwinds ahead, gold prices in India fell marginally to hit Rs 4,659 per gram for 22 carat gold, compared to Rs 4,660 yesterday, and Rs 5,083 a gram for 24 carat, down from Rs 5,084 a day before.
Lower demand needed to bridge trade deficit
The falling demand for gold could be a good thing for India, where the trade deficit has been surging, since it will cut dependence on imports. This is needed especially when the government’s efforts to make people deposit jewellery have failed, with demand for recycled gold already down in the July-September quarter. Rural India still predominantly invests their funds in gold, and hence it’s not surprising that two-thirds of the demand comes from those parts.
In the second largest market for gold, Chennai has the highest prices with Rs 4,710 per gram for 22 carat and Rs 5,143 a gram for 24 carat of the yellow metal.
National capital Delhi has second highest rates at Rs 4,674 per gram and Rs 5,098 per gram for 22 carat and 24 carat gold respectively.
Financial capital Mumbai’s prices were tied with Kolkata’s at Rs 4,659 per gram for 22 carat gold and Rs 5,083 for the 24 carat category.
Silver on the other hand went up to Rs 58.30 per gram, and will become pricier if dollar gains strength against the Rupee.
Global scenario changing
Gold is bouncing back globally with demand touching pre-covid levels, as Turkey, Uzbekistan and Qatar bought the most during the last quarter.
