Can Samvat 2078 help in regaining the lost luster of gold?

How was the performance of gold during Samvat 2077?

In Samvat 2077, international gold prices were down about 6%, compared to gains of 26% and 23% in the previous two years. Gold prices in the Indian markets also fell by 6%, the biggest fall in seven years as per the Samvat calendar. Gold prices in India touched a record ₹55,922 per 10 grams in August last year, but slipped to almost ₹Now 47,729. Gold prices have risen in the past few months amid volatility in the US dollar and bond yields. According to the World Gold Council, global demand for gold fell in July-September to the lowest level since the last quarter of 2020 as financial investors sold the metal.

Why did gold prices see a fall?

A strong dollar, rising global stocks, rising vaccination rates and falling Covid-19 cases, a possible cessation of easing monetary policy in the US and possible divergence in central bank policies pulled gold down in India and across the world. Analysts said exchange-traded funds (ETFs) also didn’t help, although gold buying by global central banks and the Commodity Futures Trading Commission (CFTC) maintaining their positions in the net long-term has dented the overall outlook for gold prices. perception has increased. However, widespread optimism among investors about a rapid recovery in the global economy helped.

What about the demand for jewellery?

Low prices and increasing mobility have boosted jewelery shopping in India. The World Gold Council says that India’s total gold demand in July-September was 139.1 tonnes, which is 47% higher than in 2020. Gold jewelery demand in India increased by 58% to 96.2 tonnes, while investment demand for bars and coins also increased by 18%. , in a quarter that is subdued.

Is gold still considered a safe haven?

Even as rival asset classes such as equities outperformed in Samvat 2077, investors still consider gold as a safe haven. Indian markets posted their best gains in 13 years, with benchmark indices Sensex and Nifty gaining nearly 40% to touch new highs during the year, marked by the outbreak of a pandemic that has set the economy back. Had given. However, inflation usually drives up the demand for gold, as it is seen as a hedge against inflation. Gold prices will react to any change in interest rate by global central banks.

How will the gold fare in Samvat 2078?

Analysts are bullish on gold prices over the next 12 months, and expect consolidation and some directional moves soon. Motilal Oswal Financial Services said gold has the potential to once again move towards $2,000 an ounce and may even take it to new life highs. On the domestic front, it expects gold prices to touch higher levels of ₹52,000-53,000/10 grams in the next 12 months. Angel One sees gold prices trending upward ₹54,000/10 gm till next Diwali. It expects gold prices to get support ₹42,300 levels.