Tag: Gold Prices

Here’s why gold prices declined today | Check latest rates in your city

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Gold prices fell more than 1% on Monday (April 22) as concerns of a broader conflict in the Middle East eased prompted investors to embrace riskier assets. This reduced the appeal of gold as a safe-haven investment, experts said.

As of 0929 GMT, spot gold recorded a 1.2% decline, settling at $2,362.09 per ounce, while US gold futures saw a 1.6% drop to $2,376.10, according to news agency Reuters.

Back home,  gold for June delivery fell by 1.04% to reach ₹72,050 per 10 grams on the Multi Commodity Exchange (MCX).

Here’s a table displaying the gold rates in various cities in India (as of April 22):

Analysts attribute the decline in gold prices to diminished likelihood of immediate rate cuts by the US Federal Reserve.

Reports suggest that a rate cut may not materialise until September, which has dampened the demand for gold as a hedge against inflation.

Additionally, the strengthening of the US dollar and rising bond yields have further propelled the downward trend in gold prices.

The recent drone strike by Israel on Iran, which was met with subdued responses from Tehran, has alleviated concerns of an escalation in tensions between the two nations.

This has also diminished the need for safe-haven assets like gold.

Despite the current setback, analysts remain optimistic about the long-term prospects of gold.

Citi research forecasts a surge in yellow metal during the second half of 2024, with gold projected to reach $2,500 per ounce.

However, there may be a temporary pullback in prices before the end of the second quarter, it said.

In a recent conversation with CNBC Awaaz, Mahendra Luniya, Chairman of Vighnaharta Gold, projected that gold rates may reach ₹1.68 lakh per 10 grams by the year 2030.

ALSO READ | Looking to buy physical gold amid bullish outlook? Know purchase limits and taxation rules

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Looking to buy physical gold amid bullish outlook? Know purchase limits and taxation rules

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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With gold prices on the ascent and experts forecasting further gains, many individuals may be considering buying physical gold. However, what many may not realise is that there are limits to how much gold one can legally possess.

According to the Central Board of Direct Taxes (CBDT), purchases of gold using sources such as agricultural income, legal inheritance, or savings from household finances are not subject to taxation.

Furthermore, if the quantity of gold purchased falls within specified limits, income tax officials cannot confiscate gold ornaments during raids.

For physical gold, recent CBDT guidelines stipulate that men (whether married or unmarried) can possess up to 100 grams of jewelry or physical gold.

Additionally, women can hold between 250 grams and 500 grams.

For married women, the limit is 500 grams, while for unmarried women, it is 250 grams.

Taxation on gold, meanwhile, varies depending on its form.

Investment in physical form is taxable like any other capital asset.

If gold is held for more than 3 years, it is taxable as Long Term Capital Gain (LTCG) at 20% (exclusive of education cess and surcharge) and Short Term Capital gain is taxable at normal tax slab applicable to the investor.

Gold ETFs/gold MFs are also taxable like physical gold.

Sovereign Gold Bonds (SGBs), on the other hand, are taxed as income from other sources. In case the bonds are held to maturity, the capital gains are tax-exempt.

However, capital gains are payable on the transfer of SGB like transfer of physical gold or ETF or Gold MF.

The bonds are traded on exchanges in demat form and redeemable after the fifth year.

When sold before maturity, the gains are long-term capital gains and taxable at 20% (plus education cess and surcharge).

The purchase price can be indexed using the cost inflation index.

ALSO READ | Gold prices surge: This expert thinks rates may rise up to ₹1.68 lakh per 10 grams by 2030

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Gold prices surge: This expert thinks rates may rise up to ₹1.68 lakh per 10 grams by 2030

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Gold has witnessed a significant surge in its value lately. The precious metal soared by over 13% in the initial quarter of 2024, solidifying its position as one of the top-performing asset classes.

Looking forward, industry experts are bullish on gold.

In a recent conversation with CNBC Awaaz, Mahendra Luniya, Chairman of Vighnaharta Gold, projected that gold rates may reach ₹1.68 lakh per 10 grams by the year 2030.

The surge in gold prices finds its roots in a confluence of factors, ranging from geopolitical tensions to global economic slowdowns.

Central bank purchases, inflationary pressures, heightened retail demand, increased interest through Exchange-Traded Funds (ETFs), stagnant gold mining production since 2016, and the ramifications of de-dollarisation have all contributed to the rise in gold’s value.

The question then arises: where should one allocate investments?

Experts caution against waiting for a price correction, as the volatile nature of the market offers no guarantees of a downward trend.

Instead, they advocate for a strategic approach that capitalises on gold’s inherent qualities.

Gold serves as a reliable hedge against inflation and acts as a diversification tool within investment portfolios.

Therefore, experts suggest that investors carefully evaluate their portfolios and consider dedicating a portion, typically around 10% or less, to gold.

In this regard, Sovereign Gold Bonds (SGBs) emerge as an attractive option.

These bonds offer a sense of security against market uncertainties and facilitate portfolio diversification.

Given the promising outlook for gold prices, experts say purchasing gold is a prudent move for the next 4-5 years.

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Gold prices steady amid geopolitical tensions: Check city-wise rates today

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The price of 24-carat gold exhibited a marginal decline of ₹10 in early trade on Friday, April 19, according to data sourced from the GoodReturns website. 10 grams of the precious metal were valued at ₹73,790.

The disparity in gold prices across key Indian cities is evident, as depicted in the following table:

Globally, gold has been buoyed by escalating tensions in the Middle East, particularly between Israel and Iran.

Investors, seeking refuge from geopolitical uncertainty, have flocked to gold, driving its prices higher, according to news agency Reuters report.

US gold prices surged on Friday, poised for their fifth consecutive weekly gain, reflecting the ongoing demand for safe-haven assets amidst political turmoil.

Everett Millman, chief market analyst with Gainesville Coins, emphasised the role of geopolitical tensions in influencing gold prices.

“When there are geopolitical tensions, the natural response is for investors to flee to gold, which is happening now,” he was quoted as saying in a Reuters report.

Millman suggested that in the event of further escalation, gold prices could soar to $2,500-2,600 per ounce, whereas a ceasefire could prompt a decline to $2,200.

In the domestic market, experts foresee a continuation of upward momentum.

Notably, the yellow metal has already surged more than 15% in the past three months and emerged as the best-performing asset class since the beginning of 2024.

Nirav Bhansali, a member of the Gem & Jewellery Export Promotion Council (GJEPC), predicts further growth, stating that gold prices may surge to ₹75,000 per 10 grams by the year’s end.

ALSO READ | Why this may be the right time to go for a gold loan

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Gold prices gain on weaker dollar — check rates in your city today

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Gold prices were steady on Thursday (April 18), driven by a variety of factors both at home and abroad. According to data from India’s Multi Commodity Exchange (MCX), gold prices were trading around ₹73,030 per 10 grams, marking an increase of ₹45 compared to the previous day.

Futures contracts mirrored this trend, with prices edging upwards to ₹72,549 per 10 grams from the previous figure of ₹72,523.

Across major Indian cities, including Ahmedabad, Mumbai, New Delhi, Chennai, and Kolkata, gold prices hovered around the ₹74,000 per 10 grams mark.

(Source: CNBC Awaz)

Internationally, gold prices experienced a similar trajectory, with spot gold increasing by 0.8% to $2,379.33 per ounce at 10.01 am GMT.

This rise was attributed to a weaker US dollar and heightened investor concerns over geopolitical tensions, particularly in the Middle East.

“The weakening dollar has been supportive of precious metals across the board today. There are also other supportive factors like geopolitical risks and central bank diversification that have played a role,” Bank of China International (BOCI) analyst Xiao Fu was quoted as saying in a Reuters report.

Geopolitical tensions, including escalations between Israel and Iran, alongside the European Union’s decision to increase sanctions against Iran, contributed to market uncertainty.

Investors sought refuge in assets perceived as safer, including gold, amidst these geopolitical uncertainties.

However, analysts remain cautious about the sustainability of this upward trend.

The Federal Reserve’s cautious approach to rate cuts, as highlighted by Federal Reserve Chair Jerome Powell, and the potential for profit-taking could exert downward pressure on gold prices in the near future.

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Why this may be the right time to go for a gold loan

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Gold prices are currently trading above the ₹72,000 per 10 grams mark on the Multi Commodity Exchange (MCX). While these high gold prices may be a problem for those purchasing gold, they benefit those seeking gold loans.

One of the primary reasons behind the optimistic outlook is the direct correlation between rising gold prices and the advantageous position of gold loan borrowers.

As gold loans are secured by the pledged gold, the surge in gold prices translates into a higher value for the collateral.

This implies that borrowers can potentially access larger loan amounts against the same quantity of gold compared to periods of lower prices.

Mehak Srivastava, Head of Marketing at SahiBandhu Gold Loans, highlighted the favourable timing for individuals to explore gold loans.

“Taking out gold loans at this time could be beneficial because gold prices are rising. Given the recent price increase, borrowers may be able to obtain a bigger loan amount than in previous times,” she told CNBC-TV18.com.

Notably, the yellow metal has surged more than 15% in the past three months and emerged as the best-performing asset class since the beginning of 2024.

Looking ahead, experts foresee a continuation of this upward momentum.

Nirav Bhansali, a member of the Gem & Jewellery Export Promotion Council (GJEPC), predicts further growth, stating that gold prices may surge to ₹75,000 per 10 grams by the year’s end.

Economic factors such as inflation and interest rates are expected to play significant roles in shaping future gold prices.

With such projections, securing gold loans becomes increasingly appealing.

Historical data also underscores the correlation between the popularity of gold loans and fluctuations in gold prices.

When gold prices surge, there is a corresponding increase in the demand for gold loans, primarily due to the enhanced value of the collateral.

“Conversely, during periods of low gold prices, the demand for gold loans may decrease as borrowers adopt a wait-and-see approach, anticipating a future uptick in gold prices before leveraging their gold assets,” Srivastava said.

Factors to consider

The value of the gold deposited as collateral determines the amount of the gold loan. At the moment, banks offer a loan to value (LTV) of 75%, whereas other financial service providers lend up to 60%.

This means if the gold is worth ₹1 lakh, the person can get a loan for ₹75,000.

The interest rates on gold loans, availed by pledging gold, are notably lower than other types of loans, ranging between 8-26% per annum.

Additionally, banks and financial institutions in India offer gold loans with amounts ranging from ₹1,500 to ₹1.5 crore, with repayment tenures spanning from three months to four years.

A look at gold loan rates of some of the lenders:

(Source: Bankbazaar)

Gold loan platforms play a crucial role in facilitating access to offers and essential information about gold loans, including interest rates and tenures from various banks.

By leveraging such platforms, borrowers can compare and identify lenders offering competitive interest rates for specific loan terms.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Gold price may go up to $3,000 an ounce, says Citi

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Analysts at Citi said that the international price of gold may hit $3,000 an ounce as more money flows into the exchange-traded funds backed by the yellow metal.

The current price is a little less than $2,400 per ounce in Singapore at 1 pm local time, an all-time high for the international gold prices — triggered by the rising possibility of a war between Iran and Israel.

Gold prices have gained more than 20% since mid-February despite the lack of ETF inflows.

Gold ETFs’ holdings had declined by 120 tonnes since the beginning of 2024 to 2,542 tonnes as of April 10. In 2023, gold ETF holding fell by 254 tonnes, according to data from Bloomberg.

Citigroup expects the average price of gold to be about $2,350 an ounce  in 2024 before a 40% jump to $2,875 in 2025.

Gold prices rise when there’s a fear of uncertainty like a conflict or a pandemic. People invest in gold as a hedge against inflation.

Analysis by CNBC-TV18’s Sonal Sachdev showed that investing in gold would have helped beat inflation by 400 basis points.

Meanwhile, gold prices recorded a hike on the Multi Commodity Exchange (MCX) on Tuesday, April 16, 2024.

Gold futures, maturing on June 5, 2024, stood at ₹72,813 per 10 grams on the MCX, after recording a jump of ₹536 or 0.74%.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Decoding the recent surge in gold prices: Here are key ways to invest in yellow metal now

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Gold prices witnessed a slight decline on Monday (April 15). On the Multi Commodity Exchange (MCX), gold contracts for June delivery traded lower ₹80 or 0.23% at ₹71,763 per 10 grams in a business turnover of 22,483 lots.  This dip, attributed to profit booking and weak global cues, reflects a momentary shift in market sentiment.

However, analysts emphasise that despite this minor setback, the overall trend for gold remains bullish, with prices reaching new heights in recent times.

Understanding market dynamics

Geopolitical tensions

The ongoing conflict between Iran and Israel continues to fuel uncertainty in the global market.

This geopolitical turmoil has been a significant driver of gold prices, as investors seek refuge in the precious metal amid heightened risk perceptions.

Central bank buying

Central banks around the world have been actively increasing their gold reserves, contributing to the upward trajectory of gold prices.

This steady demand from institutional buyers has provided a strong foundation for the metal’s value.

Interest rate expectations

Speculation regarding potential interest rate cuts by the Federal Reserve later in the year has further supported gold’s appeal.

Lower interest rates reduce the opportunity cost of holding gold, making it an attractive investment option in times of economic uncertainty.

What comes next?

Rahul Kalantri, VP of Commodities at Mehta Equities Ltd, maintains a positive outlook for gold, citing ongoing support from global central banks and persistent geopolitical risks.

However, Colin Shah, MD of Kama Jewelry, believes that the price of gold will continue to be volatile and highly unpredictable, given the escalations between the countries in conflict and the response by G7.

Investment strategies

Investors seeking to capitalise on the current market conditions may consider various strategies for gold investment, including:

Physical gold

Investing in physical gold, such as bars or coins, provides investors with a tangible asset that can serve as a hedge against economic uncertainty and inflation.

Gold Exchange Traded Funds (ETFs)

Gold ETFs allow individuals to invest in gold in a dematerialised format, which can be bought and sold on the stock exchange like shares.

Gold equivalent to physical quantity is deposited in an electronic form, in the purchaser’s demat account.

These are listed on the stock exchange, where one can get real-time updates about their price. ETFs don’t have any exit loads, which means investors can buy or sell the units at any time during the market hours.

Sovereign Gold Bonds (SGBs)

SGBs are government securities denominated in grams of gold. They are substitutes for holding physical gold. Investors have to pay the issue price in cash, and the bonds are redeemed in cash on maturity.

It is considered a safe way to invest in gold, especially for those with a long investment window of 5-8 years.

The Reserve Bank of India (RBI) issues SGBs multiple times a year and fixes a price for each issuance. Users can also buy or sell SGBs in the secondary market.

Gold mutual funds

Gold mutual funds are open-ended funds that allow the citizens to invest without a Demat account. The gold fund units are determined by way of Net Asset Value (NAV), which is disclosed at the end of the trading hours. In this scheme, experts manage the investment professionally to create wealth and reduce risks.

Units of gold funds can be redeemed by selling them back to the fund house based on the NAV for the day.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Gold rises as Iran strike against Israel stokes haven demand

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Gold jumped at the open after Iran’s unprecedented attack on Israel over the weekend drove demand for haven assets.

Bullion rose as much as 1.2% to near a record high as the conflict in the Middle East entered a dangerous new phase, before paring around half of that gain. The Islamic Republic fired more than 300 drones and missiles against Israel, though most were intercepted and there were no fatalities reported.

The precious metal broke through $2,400 an ounce on Friday, but closed the session lower as technical indicators indicated its rally had run too hot and investors liquidated positions. The latest developments in the Middle East rekindled the flight to safety, with fears over a potential retaliation by Israel likely to support gold in the near term.

Gold has surged by almost 20% since mid-February in a rally that’s taken many investors by surprise. The Federal Reserve moving closer to its much-anticipated pivot, robust buying by central banks and increased demand from Chinese consumers have been the main drivers, along with rising geopolitical risk in the Middle East and Ukraine.

Spot gold rose 0.6% to $2,359.10 an ounce as of 7:32 AM in Singapore, after rising by 0.6% last week. The Bloomberg Dollar Spot Index dipped 0.1%, following a 1.3% gain last week, the most since September 2022. Silver advanced, platinum was steady, while palladium slipped.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Gold prices rise to ₹72,120 per 10 grams: How long will this rally continue?

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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In the wake of escalating geopolitical tensions, gold prices have surged both domestically and globally. On Thursday, April 11, the price of 10 grams of pure gold (24-carat) hovered around ₹72,120 in the domestic market.

Internationally, spot gold climbed to $2,345.56 per ounce, marking a 0.6% increase, with US gold futures also rising by 0.6% to $2,362.80.

The rally in gold prices has been attributed to several factors, foremost among them being higher-than-expected consumer prices persisting for the third consecutive month, thus challenging the Federal Reserve’s tolerance for inflation.

Data revealed that US inflation in March exceeded forecasts, effectively diminishing the likelihood of a rate cut in June, according to news agency Reuters.

This unexpected inflation surge has led market strategists to anticipate a longer period of tight monetary policy, consequently supporting the appeal of gold as a hedge against inflation and geopolitical uncertainties.

Central bank purchases, safe-haven inflows amidst ongoing geopolitical risks, and momentum-following fund demand have collectively fueled gold’s 14% gain so far this year.

Moreover, recent strong US economic indicators, including a robust jobs report that surpassed expectations, have raised doubts about the feasibility of rate cuts in the near future.

Higher interest rates typically reduce the attractiveness of holding non-yielding assets like gold, but the prevailing geopolitical tensions have counteracted this effect, further propelling gold prices upwards, a Reuters report said.

What lies ahead?

Looking ahead, experts foresee a continuation of the upward momentum in gold prices.

Nirav Bhansali, a member of the Gem & Jewellery Export Promotion Council (GJEPC), predicts that gold prices may surge to ₹75,000 per 10 grams by the end of the year.

Economic factors such as inflation and interest rates are expected to significantly influence future gold prices.

What should investors do?

Waiting for a price drop may not be advisable, as there is no guarantee of a decrease, and prices may continue to rise beyond reach.

Given gold’s immediate protection against inflation and its role in diversifying investment portfolios, investors should assess their portfolios and consider allocating a portion, typically 10% or less, to gold.

This strategy can help hedge against market uncertainties and maintain portfolio diversification amidst volatile geopolitical and economic conditions.

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3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow