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| Trend of Gold Rate in India in 6 Months |
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Also check : Silver Rate in India
Gold Rate in India
India is the largest consumer of gold in the world, accounting for almost a quarter of the world’s total consumption. It has, since long, maintained this position and, unlike countries like China, India uses gold primarily in the form of jewelry and investments. It is viewed as a solid instrument for investments and even traders who are into commodities trading, invest in gold bullion. These investments are usually dictated by the gold rates prevailing in the economy at that time.
Even the global view of gold is that of a safe haven where you can invest even when investments in the economy of a country are not a good idea. This is because it is believed that this commodity always appreciates.
Trend of Gold Rate in India for November 2018 (rates per gram of 24 karat gold)
November 2018 - Week 1 (1 - 4):
| Parameters | Gold price (per gram of 24 karat gold) |
| November 1 Rate | Rs.3,184 per gram |
| November 4 Rate | Rs.3,191 per gram |
| Overall Weekly Performance | Incline |
- The month began with gold rate in India holding at Rs.3,184 per gram with steady global demand amid positive market trends.
- Gold prices dropped by Re.1 to Rs.3,183 per gram the next day before rebounding to Rs.3,191 per gram on the 3rd after the US dollar weakened ahead of the US nonfarm payroll data.
- The week came to an end with gold price in India closing at Rs.3,191 per gram on the 4th with steady investor demand amid strong global cues.
November 2018 - Week 2 (5 - 11):
| Parameters | Gold price (per gram of 24 karat gold) |
| November 5 Rate | Rs.3,179 per gram |
| November 11 Rate | Rs.3,134 per gram |
| Overall Weekly Performance | Decline |
- The week began with gold rate in India holding at Rs.3,179 per gram on the 5th with subdued domestic demand amid the weak trend overseas.
- With local demand picking up amid the festive season, gold price in India surged to Rs.3,187 per gram the next day.
- However, with the yellow metal losing its sheen ahead of the US Federal Reserve policy statement, demand for metal dropped considerably and gold was recorded trading at Rs.3,134 per gram on the 11th.
November 2018 - Week 3 (12 - 18):
| Parameters | Gold price (per gram of 24 karat gold) |
| November 12 Rate | Rs.3,141 per gram |
| November 18 Rate | Rs.3,124 per gram |
| Overall Weekly Performance | Decline |
- Demand for gold was on the decline as the week began, with the metal trading at Rs.3,141 per gram on 12 November on subdued global demand.
- Brexit negotiations and the political uncertainty in Europe did not boost the metal’s prices, which plunged to Rs.3,096 per gram on 14 November as markets rallied.
- As Britain’s European Union exit plan was released to negative reviews, markets plunged and gold rose briefly to Rs.3,124 per gram on 17 November.
- Prices remained constant, with gold rate in India closing at Rs.3,124 per gram on 18 November, a decline of Rs.17.
Trend of Gold Rate in India for October 2018 (rates per gram of 24 karat gold)
| Parameters | Gold price (24 karat) |
| October 1 Rate | Rs.3,071 per gram |
| October 31 Rate | Rs.3,188 per gram |
| Highest Rate in October | Rs.3,211 per gram on 15 October |
| Lowest Rate in October | Rs.3,071 per gram on 1 October |
| Overall Monthly Performance | Incline |
| Percentage Change | 3.80% |
October 2018 - Week 1 (1 - 7):
| Parameters | Gold price (per gram of 24 karat gold) |
| October 1 Rate | Rs.3,071 per gram |
| October 7 Rate | Rs.3,158 per gram |
| Overall Weekly Performance | Incline |
- Expectations of a rise in the dollar rate saw gold price India open lower at Rs.3,071 per gram when trading began, but prices rose over the rest of the week.
- The precious metal saw a sharp rise in price, trading at Rs.3,085 per gram on 2 October as investors increased their risk appetite.
- Local demand was also on the rise, as jewellers increased orders ahead of the festive season, sending gold prices to Rs.3,129 per gram on 3 October.
- Prices fell briefly to Rs.3,120 per gram on 5 october as a rally by the dollar led to higher demand for currency.
- Gold rate in India rose as the week ended, trading at Rs.3,158 per gram on 7 October to record an increase of Rs.87 during the week.
October 2018 - Week 2 (8 - 14):
| Parameters | Gold price (per gram of 24 karat gold) |
| October 8 Rate | Rs.3,229 per gram |
| October 14 Rate | Rs.3,245 per gram |
| Overall Weekly Performance | Incline |
- On 8 October, the value of the dollar rose causing the price of gold in India to decline for the following few days.
- Global stocks dip in value along with the dollar on 11 October causing the gold price in India to increase.
- On 14 October, the gold price in India increased to Rs.3,245 per gram, recording an inclining trend for week 2.
October 2018 - Week 3 (15 - 21):
| Parameters | Gold price (per gram of 24 karat gold) |
| October 15 Rate | Rs.3,185 per gram |
| October 21 Rate | Rs.3,189 per gram |
| Overall Weekly Performance | Incline |
- Demand for gold was on the increase in the third week of October as falling currencies made bullion more attractive.
- The precious metal opened the week at Rs.3,185 per gram on 15 October, with prices rising by Rs.8 per gram from the previous week on rising demand.
- Retail orders increased due to the festive season, with gold jumping to Rs.3,199 per gram on 16 October.
- Gold price in India fell sharply to Rs.3,173 per gram on 17 October as stock markets recovered and industrial demand fell.
- Gold rate in India continued to fluctuate for the remainder of the week, closing at Rs.3,189 per gram on 21 October to record a marginal rise of Rs.4 over the week.
October 2018 - Week 4 (22 - 28):
| Parameters | Gold price (per gram of 24 karat gold) |
| October 22 Rate | Rs.3,182 per gram |
| October 28 Rate | Rs.3,197 per gram |
| Overall Weekly Performance | Incline |
- Gold prices saw some fluctuation during the week as conflicting cues pressured the metal.
- The week began with gold priced at Rs.3,182 per gram on 22 October but prices jumped to Rs.3,190 per gram on 23 October on strong local demand.
- In spite of a depreciating US dollar making gold more expensive, retail demand propelled prices to Rs.3,200 per gram on 25 October.
- The sharp slide in technology stocks led to a global market crash and higher interest in gold, as the metal traded at Rs.3,205 per gram on 27 October.
- Prices fell as the week ended, as gold rates in India closed at Rs.3,197 per gram on 28 October to record a rise in price of Rs.15 during the week.
October 2018 - Week 5 (29-31):
| Parameters | Gold price (per gram of 24 karat gold) |
| October 29 Rate | Rs.3,194 per gram |
| October 31 Rate | Rs.3,188 per gram |
| Overall Weekly Performance | Decline |
- The last week of October saw a decline in gold prices as a rising dollar and lower overseas orders resulted in a drop in demand.
- Gold opened the week at Rs.3,194 per gram on 29 October, falling slightly as retail demand dropped due to the rising dollar.
- Fluctuating crude prices and the falling rupee made local gold more expensive, which was reflected in the fall in price to Rs.3,191 per gram on 30 October.
- The end of the month saw gold prices in India continue to slide, as the metal closed the month at Rs.3,188 per gram.
Trend of Gold Rate in India for September 2018 (rates per gram of 24 karat gold)
| Parameters | Gold price (24 karat) |
| September 1 Rate | Rs.3,029 per gram |
| September 30 Rate | Rs.3,074 per gram |
| Highest Rate in September | Rs.3,098 per gram on 19 September |
| Lowest Rate in September | Rs.3,019 per gram on 3 September |
| Overall Monthly Performance | Incline |
| Percentage Change | 1.48% |
September 2018 - Week 1 (1 - 8):
| Parameters | Gold price (per gram of 24 karat gold) |
| September 1 Rate | Rs.3,029 per gram |
| September 8 Rate | Rs.3,065 per gram |
| Overall Weekly Performance | Incline |
- The start of September saw gold rates in India recover some value on increased retail trade and positive trends.
- Gold was priced at Rs.3,029 per gram when trading began before dropping to Rs.3,019 per gram on 3 September as the dollar rate recovered, reducing demand for gold.
- A falling rupee affected gains, though gold bounced back to trade at Rs.3,033 per gram on 4 September over fears of a possible trade war.
- Gold price in India climbed to Rs.3,053 per gram on 6 September as overseas demand for gold helped push prices higher, with local jewellers also increasing orders.
- Industrial demand steadied prices towards the end of the week, as the metal traded at Rs.3,065 per gram on consistent demand and favourable trends.
September 2018 - Week 2 (9 - 14):
| Parameters | Gold price (per gram of 24 karat gold) |
| September 9 Rate | Rs.3,065 per gram |
| September 14 Rate | Rs.3,064 per gram |
| Overall Weekly Performance | Decline |
- Demand for gold in India was sluggish in the second week, as the metal traded at Rs.3,065 per gram on 9 September.
- The continued trade tensions between the U.S. and China boosted the dollar as the yellow metal’s value fell sharply.
- Gold price in India rose to Rs.3,080 per gram on 12 September as gold recouped some of its losses after the dollar slid across currency markets.
- Anticipation of an interest rate hike reduced investor interest in gold, as local markets also fell, pushing gold price India dropped down to Rs.3,068 per gram on 13 September.
- The week ended with gold falling further to Rs.3,064 per gram on 14 September as market forces resulted in prices declining.
September 2018 - Week 3 (15 - 22):
| Parameters | Gold price (per gram of 24 karat gold) |
| September 15 Rate | Rs.3,066 per gram |
| September 22 Rate | Rs.3,077per gram |
| Overall Weekly Performance | Incline |
- There was a rise in gold price in India in the third week as concerns over the dollar and the trade war led to higher reliance on bullion.
- The precious metal opened the week at Rs.3,066 per gram on 15 September as the possibility of new tariffs on Chinese goods hit markets badly.
- Prices were on a cautious rise as retail demand was on the increase ahead of the festive and wedding seasons.
- Gold reached Rs.3,069 per gram on 17 September before prices jumped to Rs.3,079 per gram on 18 September.
- The dollar weakened significantly in light of retaliatory tariffs on U.S. goods by China, as investors looked to bullion as a safe-haven asset.
- Gold rate in India jumped to Rs.3,091 per gram on 19 September as mounting pressure on the dollar led to a rally by gold.
- Prices dropped as the week ended, with the metal priced at Rs.3,077 per gram on 22 September to register a rise of Rs.11.
September 2018 - Week 4 (23 - 30):
| Parameters | Gold price (per gram of 24 karat gold) |
| September 23 Rate | Rs.3,077 per gram |
| September 30 Rate | Rs.3,074 per gram |
| Overall Weekly Performance | Decline |
- Gold price in India were on the decline in the last week of September after a turbulent week of trading.
- The precious metal opened trading at Rs.3,077 per gram on 23 September, with no change in price from the previous week due to stable demand.
- Prices rose to Rs.3,090 per gram on 25 September ahead of the Fed Reserve meeting, as demand from jewellers rose ahead of the festive season.
- Demand for gold fell sharply after the Federal Reserve raised interest rates, resulting in the metal trading at Rs.3,077 per gram on 27 September.
- Gold dropped to Rs.3,049 per gram on 28 September as the dollar rose on positive economic data and the rate hike, reducing interest in bullion.
- Gold rate in India recovered as the month ended, with gold priced at Rs.3,074 per gram on 30 September.
Also check Today's Gold Rate in the most popular Indian cities
Gold Related Topics
Trend of Gold Rate in India for August 2018 (rates per gram of 24 karat gold)
| Parameters | Gold price (24 karat) |
| August 1 Rate | Rs.2,983 per gram |
| August 31 Rate | Rs.3,039 per gram |
| Highest Rate in August | Rs.3,039 per gram on 31 August |
| Lowest Rate in August | Rs.2,800 per gram on 16 August |
| Overall Monthly Performance | Incline |
| Percentage Change | 1.87% |
August 2018 - Week 1 (1 - 5):
| Parameters | Gold price (per gram of 24 karat gold) |
| August 1 Rate | Rs.2,983 per gram |
| August 5 Rate | Rs.2,973 per gram |
| Overall Weekly Performance | Decline |
- Demand for gold was on the decline in the first week of August, as local demand continued to be poor due to the high dollar rate.
- The gold rate in India was Rs.2,983 per gram on 1 August, as the upcoming Fed Reserve meeting led to reduced appetite for bullion.
- The dollar’s fall against the yen boosted interest in bullion, but local investors kept away, waiting for rates to fall further.
- Gold plunged to Rs.2,956 per gram on 3 August as positive assessments of the U.S. economy pushed the dollar and equity markets higher.
- Gold price in India recovered somewhat as the week ended, with gold priced at Rs.2,973 per gram on 5 August.
August 2018 - Week 2 (6 - 12):
| Parameters | Gold price (per gram of 24 karat gold) |
| August 6 Rate | Rs.2,967 per gram |
| August 12 Rate | Rs.2,984 per gram |
| Overall Weekly Performance | Incline |
- The demand for gold during the second week of August was on the rise due in spite of steady dollar rates.
- The gold price in India stood at Rs.2,967 per gram on 6 August, as the dollar weakened during this period.
- The dollar rose to a 13 month high on 10 August which impacted the gold rate in India.
- Gold price in India then rose to Rs.2,984 per gram on 12 August as dollar strengthens after European Banks’ were exposed to turkey.
- The week ended with Gold rates in India at Rs.2,984 per gram, and was an incline trend as the gold price rose marginally over the course of the week.
August 2018 - Week 3 (13 - 19):
| Parameters | Gold price (per gram of 24 karat gold) |
| August 13 Rate | Rs.2,985 per gram |
| August 19 Rate | Rs.2,952 per gram |
| Overall Weekly Performance | Decline |
- The gold price in India during the third week of August was on the decline as dollar rates hit a near 13-month high.
- On 13 August, the gold price in India stood at Rs.2,985 per gram. During the same period, the dollar value was on a rise.
- The gold price then stabilised for a few days after which it declined marginally towards the end of the week.
- At the end of Week 3, the gold rate in India declined in comparison to the former part of the week. The price of the metal on 19 August stood at Rs.2,952 per gram. This was during the same period when US - China trade talks were in place.
- Week 3 ended with the metal was priced at Rs.2,952 per gram, and showed a declining trend for the week ending 19 August.
August 2018 - Week 4 (20 - 26):
| Parameters | Gold price (per gram of 24 karat gold) |
| August 20 Rate | Rs.2,952 per gram |
| August 26 Rate | Rs.3,004 per gram |
| Overall Weekly Performance | Incline |
- The week began with gold rate in India holding at Rs.2,952 per gram on the 20th as investors gravitated towards the bullion after hitting its lowest level since January last week.
- With the US dollar losing ground after President Trump’s negative comments on the US Federal Reserve’s interest rate hike, demand for the metal surged.
- This led to gold price in India surging to Rs.2,962 per gram and Rs.2,974 per gram on the 21st and the 22nd respectively.
- Rates, however, dropped over the next couple of days as the dollar recovered on market expectations of rising US interest rates and gold in India was recorded trading at Rs.2,968 per gram on the 24th.
- The 25th saw gold price in India rebounding to Rs.3,004 per gram as the US greenback stabilised as markets awaited the US Federal Reserve Chairman’s speech on the pace of interest rates.
- The week concluded with gold rate in India closing at Rs.3,004 per gram with steady domestic demand from industries and jewellers amid the firm trend overseas.
August 2018 - Week 5 (27 - 31):
| Parameters | Gold price (per gram of 24 karat gold) |
| August 27 Rate | Rs.2,999 per gram |
| August 31 Rate | Rs.3,039 per gram |
| Overall Weekly Performance | Incline |
- Demand for gold in the last week of August saw an upward trend, as local demand from jewellers was on the rise.
- Gold was priced at Rs.2,999 per gram when trading opened on 27 August as interest in the asset rose following a dip in the dollar rate.
- Investors were wary of a reduction in interest rate hikes and increased interest in bullion, as gold price in India rose to Rs.3,012 per gram on 29 August.
- The increase in local demand from both jewellers as well as industry kept local price stable and on the rise in spite of demand vagaries.
- The price continued to rise as the week ended, with gold trading at Rs.3,039 per gram on 31 August to record a Rs.30 increase in price during the week.
Trend of Gold Rate in India for July 2018 (rates per gram of 24 karat gold)
| Parameters | Gold price (24 karat) |
| July 1 Rate | Rs.3,059 per gram |
| July 31 Rate | Rs.2,986 per gram |
| Highest Rate in July | Rs.3,070 per gram on 7 July |
| Lowest Rate in July | Rs.2,986 per gram on 18 & 31 July |
| Overall Monthly Performance | Decline |
| Percentage Change | -2.38% |
July 2018 - Week 1 (1 - 7):
| Parameters | Gold price (per gram of 24 karat gold) |
| July 1 Rate | Rs.3,059 per gram |
| July 7 Rate | Rs.3,070 per gram |
| Overall Weekly Performance | Incline |
- When trading commenced for the month of July, gold was priced at Rs.3,059 per gram.
- Gold price in India dropped on the 2nd as the inflation data from the previous week kept the possibility of a future Fed rate alive, and the dollar also improved.
- The precious metal traded at Rs.3,047 per gram on the 2nd due to this before dropping further to Rs.3,040 per gram on the 3rd after the dollar edged higher and gold, meanwhile reached near six-month lows.
- The US’ trade war with multiple countries seemed to reach a tipping point, which caused gold rates surge to one-week highs.
- On the 4th, the yellow metal traded at Rs.3,062 per gram as stock markets around the world fell, and almost all major currencies tanked.
- The 5th saw gold rate in India rise to Rs.3,067 per gram after demand softened with investors cautiously awaiting the Fed minutes.
- As the dollar remained weak, gold prices went up to Rs.3,071 per gram and fell to Rs.3,070 per gram as demand seemed to fall.
July 2018 - Week 2 (8 - 14):
| Parameters | Gold price (per gram of 24 karat gold) |
| July 8 Rate | Rs.3,070 per gram |
| July 14 Rate | Rs.3,029 per gram |
| Overall Weekly Performance | Decline |
- Trading opened for the week with gold price in India holding at Rs.3,070 per gram on the 8th with investors banking on the bullion as the greenback hovered near three-and-half week lows at the international level.
- Steady domestic demand coupled with positive global cues led to gold prices holding firm at Rs.3,070 per gram until the 10th.
- However, the week saw gold rates dropping over the next few days with the US dollar recovering from near three-week lows amid lingering trade concerns between the US and China.
- With the US dollar gaining significant ground against the Yuan after the US intimidated the Chinese by threatening to impose additional tariffs on their goods, gold rate in India dropped to Rs.3,054 per gram on the 11th.
- The 12th saw rates dropping further to Rs.3,036 per gram with global demand flatlined amid the rising trade war concerns between China and the US.
- With the greenback capitalising on its gains from the previous session, market participants refrained themselves from making purchases and gold was recorded trading at Rs.3,028 per gram on the 13th.
- Trading concluded for the week with todays gold price in India holding at Rs.3,029 per gram on account of subdued but steady demand from local industries, jewellers and retailers.
July 2018 - Week 3 (15 - 22):
| Parameters | Gold price (per gram of 24 karat gold) |
| July 15 Rate | Rs.3,029 per gram |
| July 22 Rate | Rs.3,018 per gram |
| Overall Weekly Performance | Decline |
- Gold was priced at Rs.3,029 per gram when trading began for the third week of July, on the 15th
- As the market expected a Fed Rate hike to be introduced, gold rates were holding steady both in the local and international market, and the metal traded at Rs.3,029 per gram.
- Gold steadied as the day progressed on the 17th before falling significantly after the Fed Reserve testimony turned out to boost the dollar.
- This caused gold price in India to drop to Rs.3,021 per gram on the 17th before falling to Rs.2,991 per gram the next day as gold was on course to hit a yearly low.
- There was a reprieve for gold in the form of Donald Trump, which caused prices to go up to Rs.2,997 per gram on the 20th.
- The US President slammed the dollar and criticized the interest rate hikes, which caused a drop in the US dollar.
- Local demand was significantly higher in India despite a strong dollar, which caused rates to surge over the next few days.
- On the 21st, the precious metal traded at Rs.3,018 before holding on at this rate on the 22nd as well.
July 2018 - Week 4 (22 - 31):
| Parameters | Gold price (per gram of 24 karat gold) |
| July 22 Rate | Rs.3,018 per gram |
| July 31 Rate | Rs.2,986 per gram |
| Overall Weekly Performance | Decline |
- Gold opened the fourth week priced at Rs.3,018 per gram on 22 July as markets reacted negatively to the criticism of the dollar.
- Prices were on the decline as the dollar recovered over the weekend, sending gold prices tumbling to Rs.2,997 per gram on 24 July.
- Fluctuations in demand for bullion continued as trade tensions increased, with gold registering a rate of Rs.3,003 per gram on 29 July.
- Gold growth continued to be sluggish as the month ended, trading at Rs.2,986 per gram on 31 July due to poor demand from retail and industrial sectors.
Get Here:Historical gold rate trend in India
Trading in gold is a preferred investment mode of investors who are financially savvy and have the required risk-appetite for this kind of market. It requires prudent monitoring of investments as gold prices are subject to change for many reasons. Maintaining or closing a position in this market depends on how well an investor can track, analyze and synthesize pricing information.
Some of the key factors that affect gold prices are outlined below:
- Import costs: Since demand is primarily met through gold imports, import costs affect gold rate in India. Higher the costs, higher the price of gold.
- Interest rates on bank fixed deposits: Bank FDs are the go-to investment option for Indians. It is only rivalled by investments in gold. When FD rates fall, investors prefer moving their money to gold. Hence, the demand for gold rises and thereby prices.
- Strength of the US dollar: When the US dollar weakens, gold rates in India rise and when the US dollar strengthens, gold prices in India fall. This is because central banks which maintain US dollar reserves tend to hedge against risks of a devaluing dollar by investing in gold. This pushes prices up. Also, India buys its gold from foreign countries and when the US dollar strengthens against the Indian rupee, it makes purchases of gold (usually done in USD), more expensive.
- Global economic stability: Gold prices rise during times of economic instability as gold is considered safer asset that others and people tend to move their money out of riskier assets into gold. Other assets bear the risk of being significantly devalued whereas gold which is has high liquidity continues to hold value even during times of crisis.
- Seasonality: In India, demand for gold during festivals, marriages and other auspicious occasions. Prices tend to be higher during these times.
- Inflation: Since gold is bought to hedge against inflation, gold prices tend to rise when inflation is on an upward trend.
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International prices: In general, when gold rates are on an upward trend, globally, gold prices in India also move upwards. Many central banks, especially in the US and in Europe hold huge gold reserves. When these banks or other financial organizations buy more gold, prices move upward.
International gold prices are hugely affected by the prices fixed on the London Gold Market, twice a day i.e. once at 10:30 a.m. and once at 3 p.m. USD is the currency generally used when quoting prices although it is fixed in Pound Sterlings and Euros as well.
- Production costs: Mining companies increase prices at times on account of production costs. This is reflected in the price of gold imported in India.
- Supply: Domestic production and supply is limited in India. Supply constraints can push prices upwards. Similarly, lower supplies of gold globally can make the metal dearer in India.
Gold rates vary across different cities in India. Key reasons for this are:
- Taxes: State taxes differ from state to state. Some states levy higher taxes than others. This is one of the reasons why gold is more expensive in some cities than others.
- Demand: Owing to different population sizes and varying demographics, demand for gold also varies. Discounts are usually offered on larger volumes. So gold prices in cities like Mumbai are lower given larger quantums of transactions.
- Carriage: Indian imports a bulk of its gold requirements by sea. Gold prices at port cities e.g. Chennai are lower than those in interior cities e.g. Delhi because of the absence of inland transport charges.
- Local associations: Cities have their own local gold associations which have a say in setting the prices. This will also account for differences in gold prices between cities.
Gold is measured in grams and troy weight. (Troy ounces, million ounces, grams, kilograms, tonnes, short tonne, metric tonnes, tolas etc.)
Karat is used to represent purity when gold is mixed or alloyed with other base metals such as copper. 24K or 24 karat gold is pure gold. Fineness is to represent gold parts per thousand. (18K gold would be 18 of 24 karats out of 1,000 parts or a fineness of 750).
Carat - It is a unit of weight used to measure precious gems such as diamonds as well as pearls. 200 milligrams or 0.2 grams make a metric carat. Carats are abbreviated to ct. Carats are often mistaken to denote size.
Karat - It is a unit of finesse or purity used to measure gold. 24 karat gold denotes pure gold. When gold is mixed with another metal the purity is diluted. The purity is then expressed as the parts of gold out of 24. E.g. 22 karat gold (mixed with copper) will be 22 parts gold and 2 parts copper. Gold being soft is alloyed with another metal, usually copper, to attain form. Karat is abbreviated to kt.
Karats represent the finesse or purity of gold. Gold being a very malleable metal is too soft to attain form on its own. It is usually alloyed with another metal, mostly copper, in order to attain form. The purity of the gold is then represented in karats as the parts of gold present out of 24.
24 karat gold is 99.99% pure gold whereas 22 karat gold is 91.67% pure. 22 karat gold means, the alloy consists of 22 parts gold and 2 parts of the alloyed metal.
24k gold is priced higher than 22k gold being purer, however, some people prefer 22k gold being more durable. Import duties are generally lower for 24k gold and higher for 22k gold.
India’s primary demand for gold is for use as jewelry. Investments are the next greatest demand driver. Unlike China, the next highest consumer of gold in the world, whose primary demand for gold is for industrial purposes, India’s industrial usage of gold is minimal.
Domestic production of gold in India is limited and, given its strong demand, India relies heavily on gold imports every year. Currently, the Kolar mines in Karnataka are the only operational mines in India, grossly unable to meet domestic demand.
Gold imports in India constitute the next largest chunk of total imports after crude oil. Of late, the government has increased its focus on curbing the negative impact of heavy gold imports viz. a widening trade deficit and rupee devaluation.
Gold is considered valuable for many reasons, mainly
- Value: Although gold prices fluctuate in the near to medium term, its value tends to rise in the long-term. For this reason, people invest and hold on to gold for a long period of time. Gold tends to not be affected by geopolitical or economic turmoil. It is valuable during emergencies providing liquidity as it is easily traded. It is a hedge against inflation as well and acts as a great value addition to an investor’s portfolio.
- Industrial uses: Gold is used in certain manufacturing processes. Although not comparable to retail consumption, many countries use gold for production purposes.
- Versatile metal: Gold is available in many useful forms making it a versatile investment. It is popularly used as jewellery and other gift items and held in the form of coins, bars or bullion. It is also available in edible form or woven into fabrics. Besides all this, paperless gold instruments are now being used to represent physical gold.
- Gold reserves: Gold is maintained as reserves to back paper currencies by many countries. These paper currencies attain their values based on the value of the gold reserves that back them.
- Limited supply: The amount of gold that can be mined and produced in the world is limited. Due to this, gold attains more value as an irreplaceable asset.
- Tradition: Gold has traditionally been used for financial transactions. This has passed down through the ages and prevails even today.
Indian gold reserves
This is the amount of gold held by India’s Central Bank. Referred to as store value, it is against these reserves that currency is printed and circulated in the economy. Besides providing value to currency, these reserves act as security for amounts due to depositors or trading partners.
Indians primarily invest in gold as a means to counter inflation. While the price of gold may fluctuate over time, the value of this metal remains relatively stable, especially in the long-run. Returns on gold are generally higher in the long-run as compared to other asset classes. Real estate and equity markets have proven to be the exceptions but for most Indian investors, gold still forms a huge part of their investment portfolios.
Traditionally, investment in gold has been in the form of jewelry gold bars or gold coins. As financial markets developed over the years, new investment avenues have opened up. Gold is now increasingly being invested in through Gold ETFs (Exchange Traded Funds) or through mutual funds which invest in gold or through stocks of companies that are in the business of gold/gold-related activities. Gold is also traded as a commodity on commodity exchanges.
Investments in gold commodities, ETFs, funds and stocks can be done online adding another dimension to gold investments in India.
Gold is traded through spot contracts or derivative contracts i.e. investors can trade in gold without possessing gold in its physical form.
- Gold spot contracts are whereby gold is bought and immediately delivered (i.e. sold and delivered right away).
- Gold futures contracts are whereby gold is bought and sold at a later date as per the contract. Unlike most other commodities, gold futures are traded at spot prices and not at prices influenced by demand and supply.
Gold is traded as a commodity on three major commodity exchanges in India:
- Multi Commodity Exchange (MCX)
- National Commodity & Derivatives Exchange (NCDEX)
- National Spot Exchange (NSEL)
MCX is India’s leading commodities exchange and a leading exchange to trade in gold. Contracts traded here offer great liquidity and offer investors the option of contracts in four different sizes as outlined below with their other key features:
- Gold
- Ticker GOLD
- Trades during 6 months of the year i.e. February, April, June, August, October, December (Monday - Saturday)
- 1 contract = 1 kg of gold
- Initial margin: 4%
- Daily price limit: 3%
- Upper limit on positions: Up to 2.5 MT for individual clients; higher of 12.5 MT or 15% of open position on market for all clients together through a member
- Quality: 995 purity, 999 purity
- Gold Mini:
- Ticker GOLDM
- Trades in all 12 months i.e. January to December (Monday - Saturday)
- 1 contract = 100 grams of gold
- Initial margin: 4%
- Limits on positions: Up to 2.5 MT for individual clients; higher of 12.5 MT or 15% of open position on market for all clients together through a member
- Quality: 995 purity, 999 purity
- Gold Guinea:
- Ticker GOLDGuinea
- Trades in all 12 months i.e. January to December
- 1 contract = 8 grams of gold
- Limits on positions: Up to 2 MT or up to 250,000 contracts at one time
- Gold Petal:
- Trades in months as specified by the exchange
- 1 contract = 1 gram of gold
- Limits on positions: Up to 2,000,000 contracts at one time
Gold Information
The best decisions are informed decisions and a decision to buy gold should also be a well-informed one. Especially given the present-day scenario where one has diverse investment options, the decision to invest in gold is not just ‘at what price’ but also when, how and how much. Gold prices, gold price trends and movements, investment channels and returns on investing in gold are all important factors to consider.
Information is now available online from a number of sources both authoritative as well as informational. This facilitates decision making to save time and effort. Besides the latest gold rates and factors that affect gold prices, information is available on gold production, trades, different forms of gold (physical and paperless), leading jewellers etc. Experts also publish their views on gold as an asset as well their outlook on the performance of gold.
Gold Weight Conversion Table
| To convert from | To | Multiply by |
| Tonnes | Troy ounces | 32150.7 |
| Troy ounces | Grains | 480 |
| Kilograms | Tolas | 85.755 |
| Kilograms | Bahts | 68.41 |
| Kilograms | Troy ounces | 32.1507 |
| Troy ounces | Grams | 31.1035 |
| Million ounces | Tonnes | 31.1035 |
| Kilograms | Taels | 26.7172 |
| Troy ounces | Penny weights | 20 |
| Troy ounces | Avoirdupois ounces | 1.09714 |
| Avoirdupois ounces | Troy ounces | 0.911458 |
| Short tonne | Metric tonne | 0.9072 |
| Grams | Troy ounces | 0.0321507 |
Why gold price is increasing in India?
Gold rates in the country change on a regular basis, with a number of factors impacting rates. A close look at recent trends could highlight the reason for such changes. Some of the most common factors impacting gold rates in India are mentioned below.
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Demand and supply – Gold rates increase when the demand exceeds supply. Gold, being a natural resource is available in limited quantities, and each time the supply reduces there is a spurt in gold rates.
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International relations – International trends have a deep impact on gold rates in India, primarily due to the fact that India depends on imports to meet local demand. Any changes in international relations could translate into a change in local gold rates.
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US dollar – The US dollar plays a key role in determining international gold rates. A strong dollar results in poor gold performance and vice versa, resulting in costlier gold each time the dollar underperforms.
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Market conditions – Gold is inversely proportional to market performance, with prices going up each time there is pressure on markets.
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Government taxes and duties – The government imposes taxes and duties on a number of commodities, including gold. Any increase in these taxes automatically pushes gold rates, pinching the pocket of buyers.
There has been a recent increase in gold rates due to improved performance on the international front. The US Federal Policy rate change had a huge impact on prices, helping them pick up after a poor performance last year. One could see a further hike in rates in the coming weeks, as the US Central Bank is set to change its rates, which are likely to have a direct impact on gold.
What are the different purity levels in gold?
Gold is often purchased by weight and purity, with the purity measured in a unit called Karat. Gold is available in different purities, with the popular ones being 24 karat, 22 karat and 18 karat. While 24 karat gold is used extensively as an investment, 22 and 18 karat gold can be used to make jewellery and ornaments.
22 karat gold is a mixture of gold and alloys, in the ratio 11:1. This essentially means that 1 gram of 22 karat gold has around 91.5% pure gold, with other metals making up the remaining portion. These impurities are added to pure gold to make it more malleable and ductile, thereby making it perfect for jewellery.
Similarly, 18 karat gold is a mixture of gold and metals in the ratio 3:1, i.e. 75% pure gold and 25% metals. This is typically cheaper than 22 and 24 karat gold on account of impurities. 18 karat gold typically has a dull colour, making it easily recognisable.
Other gold options include 14 karat gold (which has 58% gold), 10 karat gold (with 42% gold) and 6 karat gold (with 25% gold).
Which is the best investment option: Physical Gold, Gold ETFs, or Sovereign Gold Bonds?
In this section, we talk about all three investment options pertaining to gold and determine which of these is better.
| Factors | Physical Gold | Gold ETFs | Sovereign Gold Bonds |
| Liquidity | Offers high liquidatable. It can be invested or exited any time an individual wants to. | ETFs also offers highly liquidity option. It can be traded on the stock exchange and can be liquidated during a trading session. However, the cost of selling is quite low compared to physical gold. | Can be bought from local banks and trade exchanges. Again, the cost of buying and selling is quite low compared to physical gold. |
| Safety | Is highly susceptible to thefts and burglary. | Very safe as it is stored in a dematerialised form in a DEMAT account. | Again, SGBs are kept in a DEMAT account and offers optimum safety. |
| Loan facility | Easily available. | Loans can be availed against gold ETFs. | Not available |
| Investment flexibility | Can be invested in a short time frame. | Can be bought in shorter quantities and requires less maintenance. | Can be bought in shorter quantities and requires less maintenance. |
| Tax Liability | All three avenues are taxed in a similar manner. To start off, any investment that is kept for more than three years is considered a long term holding and is eligible for Long Term Capital Gains (LTCG) tax, which currently remains at 20% after indexation. If they are held for less than 3 years, they are considered a short term holding and is taxed based on the individual’s tax slab Note that, Sovereign Gold Bonds offers one advantage on the tax front, wherein the gains are tax exempt if the investment is redeemed after the maturity period. | ||
Taxes on Gold in India
Gold as a commodity attracts taxation in India, and depending on what it is used for, the taxes levied on the resource differ.
Tax on Purchase of Gold
Most gold in India is imported, with the result that gold is subject to customs duty. The customs duty payable on gold stands at 10% of the total value of the gold. In addition, processing charges associated with purchase would be taxed at 5%.
The sale of gold in India brings it under the purview of GST (Goods and Services Tax) that was introduced in 2017. The GST on gold was set at 3%. As a result, the total tax payable on gold stands at 14% at present.
Income Tax on Gold
Any profit made from the sale of gold attracts income tax and both individuals as well as industry/jewellers are required to pay income tax in such a case.
The profit derived from the sale of gold falls under ‘Capital Gains Tax’ and details of tax liabilities and possible exemptions are mentioned below:
- Gold or gold jewellery bought and sold within a period of 3 years (36 months) is considered a short-term capital asset and would be taxed at the applicable rate (this is subject to change as announced by the government).
- Gold or gold jewellery bought and sold after a period of 3 years (36 months) is considered a long-term capital asset. Whether the gold was bought or given as a gift or received in the form of an inheritance, it would come under the long-term capital asset category. The taxes and other surcharges would be calculated accordingly.
- Gold received as a gift is exempt from tax if the value of the gold is less than Rs.50,000.
In the event of gold being sold and no profit being made from the sale, there is no tax since it is considered a ‘capital loss’ and can be listed at the time of filing income tax returns.
Uses of gold
Gold, as a metal, is used for a number of things apart from jewellery and bullion. In this section, we will list out the various industries that make use of the yellow metal.
- Glass making
Gold is used to a significant extent during a glass making process. Here are the three most popular uses.
- Of all the ways the metal is used, the most basic one is as a pigment. Gold is used in the annealing process to arrive at a rich ruby gloss. Annealing, to begin with, is a process involved in glass manufacturing, wherein it is heated to its ductile best and allowed to cool down slowly so as to harden it.
- Gold is also used in specialty glass making which are often used in climate-controlled buildings. A tiny amount of gold is added to a glass surface to help refract solar radiation away from a building, which in turn keeps the a building cool.
- It is used in the making of visors for astronaut helmets. Ideally, a thin film of gold is used to line the layer of helmets to keep intense solar radiation, which would otherwise harm the astronaut’s eyes.
- Electronics
Gold is used vastly in the electronics industry, thanks to its highly conductive properties. For starters, gold is used in every sophisticated electronic device, right from GPS units, cell phones, calculators, digital assistant units, and most of all television sets. The one downside to this, however, is the sheer wastage of the metal. This is because cell phones and consumer electronic products are manufactured in the millions and have a short shelf life. And due to the fact that there’s no proper recycling process in place, a considerable amount of gold is lost when the electronic products are dumped.
- Aerospace:
Aerospace vehicles are nothing like earth vehicles, and the most important distinction is that they cannot be serviced only it takes off from earth. This is why they need to be built with highly dependable materials. Here in comes gold. Thanks to its conductivity and connecting properties, the metal is used in circuitry. Besides this, most parts of a space vehicle is fitted with a gold-coated polyester film which helps keep infrared radiation out and keep the temperature inside the vehicle stable.
- Others
Apart from the uses mentioned above, gold is used in a variety of other domains, including but not limited to dentistry, awards, symbols, and statues.
FAQs About Gold
Gold is one precious metal which has managed to retain its shine over the years, creating a niche space for itself in the investment world. Being a natural resource, there is a constant mismatch between the demand and supply, making gold an extremely precious commodity, with people viewing it as a safe and reliable investment option. India is one of the largest consumers of gold in the world, with estimates indicating that the residents own over 20,000 tonnes of this precious metal. While our love for gold is witnessed across the length and breadth of India, there is more to gold than just its utility, aspects which most of us are unaware about.
Gold as a commodity isn’t the easiest one to comprehend, with certain nuances having a great impact on it. Taking time to learn about them can help you get the best out of your investment, making it truly shine.
When is the right time to buy gold in India?Although, there isn’t such a thing called the right time to buy gold, there are periods where demand is usually low and so will be the rates. So, in order to make the most of your investment, try to invest in the metal during the off-season i.e., when no major festivals aren’t around. This is because major festivals bring about an influx of buyers which will push gold prices higher.
What is the current gold price in India ?Gold rates change on a daily basis, with a number of factors impacting their price in a particular place on a given day. Demand and supply, global market conditions and currency fluctuations are some of the most critical factors which go into determining the rate of gold in a country, with prices changing every day. Gold rates in India have been following international trends, with a rise of close to 16% witnessed in the last four months. Purity also plays a key role in determining gold rates, with 24 karat gold costing more than 22 or 18 karat gold. Individuals who want to invest in gold would need to pay around Rs 3,155 per gram for 24 karat gold and Rs 3,005 for a gram of 22 karat gold (as of 05/06/2018).
What are the different avenues to invest in gold ?Gone are the days when the only mode to invest in gold was to purchase it physically. Today, there are multiple avenues through which one can buy gold, with the popular ones mentioned below.
Gold mutual funds – Gold mutual funds are offered by a number of organisations, offering ease of investment through SIPs.
Gold ETFs – Gold Exchange Traded Funds permit trading of gold in units (by weight), with the investment viewed as debt mutual funds by tax authorities.
Gold futures – Gold futures are popular among certain investors, with the MCX and NCDEX offering avenues to invest in gold through derivatives.
E-gold – E-gold is a new option to invest in gold, offering ease and flexibility to investors.
Physical gold - Physical purchase of gold in the form of coins, jewellery, bars, etc. continues to account for a major portion of investment, with the new modes expected to gain more acceptance with time.
How many grams of gold in one tola?Gold is purchased by weight, with every gram costing a decent amount of money. India is home to over 1.2 billion people, each one unique and having different modes of communication, including units of weight. While there are internationally accepted conventions when it comes to weight, certain regions have their own traditional units, with the Tola being one such popular unit.
1 Tola roughly translates to around 11.6 grams, with 1 kg of gold corresponding to 85.7 Tolas (approximately). This unit is still used in a number of towns and cities, with 1 Tola gold costing Rs 30,887 (as of April 25, 2016).
How to buy gold?Buying gold isn’t very hard, given the multiple avenues available, but there are a few key points one should keep in mind before spending that hard earned money.
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Research – Gold rates change on a daily basis and it is imperative that one does research before buying gold. Observing trends and staying abreast of changes can ensure that you get a good deal on the investment, reducing the chances of being cheated.
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Gold selection – Gold can be purchased in different forms, with each one offering unique advantages. Choose an investment avenue which matches your needs.
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Certification – There are numerous occasions wherein people have been duped into buying gold of inferior purity, purely on account of blind faith. Ensure that the jeweller or source you intend to buy from has a good record, and insist on purity certification.
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Online purchase – Individuals who wish to buy gold online need to ensure that the source they choose is trusted, for a number of sellers on the internet can be fake.
Gold is one investment which is always in demand, making it a liquid asset. Selling gold isn’t hard, with most jewellers and pawn shops willing to buy gold at market rates. Individuals who wish to sell gold need to ensure that they know current gold rates, for buyers may choose to haggle or negotiate, and failing to know present prices could result in selling gold at lower rates.
Also, gold coins and bars attract better rates than jewellery and are easier to sell. Individuals who do not wish to sell gold can choose to avail gold loans against it, with a number of banks and private lenders offering loans keeping gold as collateral.
What is 24 karat gold?24 karat gold is the purest form of gold which can be purchased, having no impurities. This purity makes it ideal for investments, with most investors choosing to purchase 24 karat gold. The only drawback of this purity is that 24 karat gold cannot be used to make jewellery or ornaments, limiting their use to gold coins or bars.
How to buy gold coins in India?Gold coins are extremely popular in the country and are available in different weights, ensuring that investors can buy gold which suits their budget. Gold coins can be purchased from banks, jewellers, post offices or online stores, with the popular ones being in the 1g to 10g weight bracket. A number of jewellers and online stores sell coins with the imprint of Gods or Goddesses, charging higher for such coins.
One can walk into any bank or jewellery store and choose to buy a coin, albeit a PAN might be required if the cost exceeds Rs 50,000. Most jewellers and banks offer a purity certificate with the coin, which could hike the cost of a coin. Gold coins can be purchased by purity as well, with the popular options being 22 and 24 karat.
One should remember to keep certain basic points like market rate, dealer reputation, certification, etc. before buying gold coins.
How to buy gold bars?Gold bars are typically reserved for serious investors, people who have sufficient funds to invest in them. These bars can be purchased in different weights, typically ranging between 500g and 1kg. Banks and big jewellers sell gold bars, although one can also purchase them online. One must remember to check the purity and prevailing market rates before investing in gold bars. A Pan is required if one is purchasing gold bars worth over Rs 50,000.
How US treasury bond yields affect gold prices in India today?Typically, US treasury yields and gold prices have an inversely proportional relationship, which is in turn connected to the Federal Reserve interest rate changes. For instance, if the Fed Reserve increases the interest rates, yields on savings accounts and bonds increase. This in turn makes gold a much weaker proposition for investors and causes gold rates to plummet. According to historic data from the last ten years, gold rates have thrived massively when 10-year yields have been at their lowest points. Note that, only the yields affect gold rates more when compared to 2-year and 5-year yields.
Is it worth investing in gold schemes offered by jewellers?For a vast majority of Indians, gold is a symbol of their stature in the societal hierarchy. Considering how expensive gold is getting each year and how most of the population can’t afford it, gold schemes are a boon in disguise. For starters, a prospective investors needs to pay a small amount on a monthly basis and you get the money’s worth in gold at the end of the tenure. Further, jewellers tend to knock off making charges altogether at times to make the deal more enticing.
Who discovered gold?Gold has been in use for millennia and the actual details of the person who discovered it is unknown. However, the earliest use of gold can be seen in the early civilisations ranging from the Greece, Egypt, and Rome among others, where gold featured heavily both in trade and commerce.
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