We Indians are the largest consumers of gold in the world, there is no other population in any other country that has a demand for gold as strong as ours. In fact, gold constitutes 12.50% of our total imports (in FY 2012-2013), which is a whopping $61,409 million.

Fluctuations in prices affect the purchasing behavior as a lot of Indians buy gold as a “safe” investment. Gold is viewed as a commodity by those who invest in it, and these investors constantly watch the market for fluctuations that could mean a potential profit, or the possibility of acquiring the asset at a lower price.

Historical gold rate trend in India

The below chart represents the historical movement of gold prices in India. It’s important to note that the gold prices would fluctuate during the year and the amount mentioned below is a representation of the average price for that year.

This chart contains the average price for gold for per year since 1964 – present. The prices indicated are for 10 grams of gold and prices are in Indian Rupees.
Year	Price	Year	Price
1964	Rs. 63.25	1991	Rs. 3,466.00
1965	Rs. 71.75	1992	Rs. 4,334.00
1966	Rs. 83.75	1993	Rs. 4,140.00
1967	Rs. 102.50	1994	Rs. 4,598.00
1968	Rs. 162.00	1995	Rs. 4,680.00
1969	Rs. 176.00	1996	Rs. 5,160.00
1970	Rs. 184.00	1997	Rs. 4,725.00
1971	Rs. 193.00	1998	Rs. 4,045.00
1972	Rs. 202.00	1999	Rs. 4,234.00
1973	Rs. 278.50	2000	Rs. 4,400.00
1974	Rs. 506.00	2001	Rs. 4,300.00
1975	Rs. 540.00	2002	Rs. 4,990.00
1976	Rs. 432.00	2003	Rs. 5,600.00
1977	Rs. 486.00	2004	Rs. 5,850.00
1978	Rs. 685.00	2005	Rs. 7,000.00
1979	Rs. 937.00	2006	Rs. 8,400.00
1980	Rs. 1,330.00	2007	Rs. 10,800.00
1981	Rs. 1,800.00	2008	Rs. 12,500.00
1982	Rs. 1,645.00	2009	Rs. 14,500.00
1983	Rs. 1,800.00	2010	Rs. 18,500.00
1984	Rs. 1,970.00	2011	Rs. 26,400.00
1985	Rs. 2,130.00	2012	Rs. 31,050.00
1986	Rs. 2,140.00	2013	Rs. 29,600.00
1987	Rs. 2,570.00	2014	Rs.28,006.50
1988	Rs. 3,130.00	2015	Rs.26,343.50
1989	Rs. 3,140.00	2016	Rs.28,623.50
1990	Rs. 3,200.00

With the exception of a few lows between some years, it can be seen from the table that the gold price trend has historically been on the rise, lending credit to the argument that gold is a safe investment over long periods of time.

Studying the gold rate trend in India

Studying the gold rate trend in India could offer an insight into future fluctuations and investment plans can be made accordingly. The gold rate depends on a number of factors like the stability of the central bank, the supply and demand of gold in the market, quantitative easing, government reserves, the health of the jewellery industry and overall yearly production to name a few.

In 2016, the lowest price recorded was Rs.24,910 per 10 grams on January 1st 2016. Gold prices soared to Rs.32,336 per 10 grams on 6th July 2016, the highest price recorded for this year. In the first half of the year, gold performance was low but showed an upward trend in the second half. The main events that affected gold rates this year included the jewellers strike against strike PAN card regulations, the Brexit vote, the expectations of an interest rate hike by the U.S. Federal Reserve, the festive and wedding seasons, Trump’s win in the U.S presidential elections and PM Modi’s demonetisation scheme.