About 50 days ago, when the gold price crossed the Rs 75,000 level, no one had thought that there would be a fall of more than 3.50 per cent in the prices. The full budget of the new government was presented on July 23. In this, the import duty on gold was reduced and the gold prices came down. On July 25, the gold prices had fallen below Rs 68,000. Since then, the gold prices have seen a rise of 5 per cent. But the investors have not yet reached the Rs 75,000 level.
According to experts, due to low demand and lack of better US economic data, gold prices are not rising as much as they should. What is special is that gold prices on foreign markets exceeded $2,570. Let’s try to understand from the data when gold prices will reach the level of Rs 75,000 in the coming days.
How much did gold become cheaper in 50 days?
A huge fall in gold prices has been observed on the Multi-Commodity Exchange. Especially in the last 50 days. On July 17, gold prices reached an all-time high of Rs 75,128. Since then, the price of gold has declined by Rs 3,722. If we talk about today, the price of gold stood at Rs 71,406 per 10 grams. This means that investors have suffered a loss of 3.67 percent due to the rising gold prices.
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Meanwhile, the government’s tax cut on gold was also a major reason for making it cheaper. On July 25, gold prices had fallen below the Rs 68,000 level. Since then, the price of gold may have risen by more than 5 percent. But gold prices did not appear even close to the Rs 75,000 level.
Why aren’t prices increasing?
What is special is that the dollar index is currently at its lowest level in almost a year. Even after that, gold prices do not seem to be getting much support. As much as they should get. According to experts, the demand for gold in China is lower. In addition, the economic data from the United States do not look as good as they should. The Federal Reserve meeting is due to take place in September. But the manufacturing data has not been as good.
On the other hand, economic data is due next week. There seems to be no chance of it getting any better. Given this situation, the question has arisen as to whether the Fed will make a possible cut or not at its meeting in September. This fear is creating fear among investors. If there are no cuts, there will be a further fall in gold prices. If the cut seems to be better than expected, i.e. more than 0.25 percent, then there will be a rise in the price of gold.
This is also a reason
On the other hand, geopolitical tension also continues. But gold prices have absorbed this tension because whatever is happening now is just a matter of words. There is no new update on the war between Russia and Ukraine. On the other hand, tension in the Middle East is only seen as verbal attacks. Unless there is a new major update on geopolitical tension, gold prices are likely to remain at this level.
On the other hand, although the dollar index is at the level of 101, the rupee has fallen significantly against the dollar. Currently, the rupee is at the level of 84 against the dollar. In this situation, the import of gold also becomes very expensive. The fall of the rupee will continue until then, no one is in a position to say anything about it. Experts recommend being very careful in this regard.
What do the experts say?
Anuj Gupta, head of commodity currencies at HDFC Securities, said a good rise in gold price can only be seen under two circumstances. The first is if the Federal Reserve cuts interest rates by more than 0.25 per cent. Because the dollar index and the market have digested the possible 24 basis point cut. The second reason is that some weapons should be used in the Middle East tension and investors should seek safe haven. He said that purchases by central banks have been seen continuously for many days. In such a situation, their effect on the market is over.
What is the current price of gold?
If we talk about the current gold prices, at 12:20 pm, there is a rise of Rs 163 on the Multi Commodity Exchange. According to the data, the prices have come down to Rs 71,629. However, the prices had also touched the day’s high of Rs 71,728. Incidentally, the gold price opened at Rs 71,481 at 9 am on Thursday. When the market closed on Wednesday, the gold price stood at Rs 71,466 per ten grams.
