Nifty99000 100%

Sensex99000 100%

Article rating: 5.0
Article rating: 4.5
Article rating: 5.0
Article rating: No rating
Article rating: No rating
Article rating: 3.0
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: 4.3
Article rating: No rating
Article rating: 3.8
RSS

News

Is it right time to buy gold?

Author: Veeresh Hiremath/Wednesday, August 1, 2018/Categories: Gold

Is it right time to buy gold?

Gold has been considered as very precious for mankind. Indians are more fascinated about buying and storing gold. Gold buying in India is dependent on the personal income, occasions and price of gold. Whenever the price falls, the retail demand for gold in India emerges. In the recent past, we have seen fall in the gold price in international as well as domestic market.

In the international market, after posting three years of consecutive positive returns, gold prices were on the rise in first half of the year. However, starting from mid-June, gold prices have started falling due to host of events. The comex gold futures prices fell to one year low of $1210.70 per troy ounce in the month of July as the strength in the dollar index, which surged to one year highs made the gold dearer for holders in other currencies.

In the US, gold is considered as a safe investment and it attracts more investment during the times of economic uncertainties. However, the trade war between United Stated and China failed to render support to gold prices. Moreover, the decision of the US Federal Reserve to raise interest rates twice in first half of the year and its intention to hike it further also pressurized gold prices.

In India, however, price fall was limited because of depreciation in Indian rupee against the US dollar. Indian rupee has depreciated by 1.87 per cent since start of June 2018, thereby capping sharp fall in gold prices. Gold futures price on MCX fell to 7 month low. The gold buying pattern can also be linked with monsoon, which will encourage rural buying if the farmers harvests good crop and earns handsome amount.

Since the gold price are trading near 7 month low, the question now is it the right time to buy gold? The answer is yes. One can start accumulating gold for long term investment. In the short term, gold prices are expected to remain under pressure because of interest rate hike scenario in the US amidst strong equity market. The fall in the gold price in the international market could trigger investment flow to Exchange Traded Funds very soon, which once again spark buying in the gold.

On the domestic front, since the prices are near seven month lows, the retail demand is emerging. The monsoon has been normal so far and agricultural activities are showing an improvement. Post harvesting of kharif crops, we could see more of rural demand for the gold.

The author is head of commodity research, Karvy Comtrade Ltd

Print Rate this article:
3.0

Number of views (439)/Comments (0)

rajyashree guha

Veeresh Hiremath

Other posts by Veeresh Hiremath
Contact author

Leave a comment

Name:
Email:
Comment:
Add comment

Name:
Email:
Subject:
Message:
x

Videos

Ask the Finapolis.

I'm not a robot
 
Dharmendra Satpathy
Col. Sanjeev Govila (retd)
Hum Fauji Investments
 
The Finapolis' expert answers your queries on investments, taxation and personal finance. Want advice? Submit your Question above
Want to Invest
 
 

Categories

Disclaimer

The technical studies / analysis discussed here can be at odds with our fundamental views / analysis. The information and views presented in this report are prepared by Karvy Consultants Limited. The information contained herein is based on our analysis and upon sources that we consider reliable. We, however, do not vouch for the accuracy or the completeness thereof. This material is for personal information and we are not responsible for any loss incurred based upon it. The investments discussed or recommended in this report may not be suitable for all investors. Investors must make their own investment decisions based on their specific investment objectives and financial position and using such independent advice, as they believe necessary. While acting upon any information or analysis mentioned in this report, investors may please note that neither Karvy nor Karvy Consultants nor any person connected with any associate companies of Karvy accepts any liability arising from the use of this information and views mentioned in this document. The author, directors and other employees of Karvy and its affiliates may hold long or short positions in the above mentioned companies from time to time. Every employee of Karvy and its associate companies is required to disclose his/her individual stock holdings and details of trades, if any, that they undertake. The team rendering corporate analysis and investment recommendations are restricted in purchasing/selling of shares or other securities till such a time this recommendation has either been displayed or has been forwarded to clients of Karvy. All employees are further restricted to place orders only through Karvy Consultants Ltd. This report is intended for a restricted audience and we are not soliciting any action based on it. Neither the information nor any opinion expressed herein constitutes an offer or an invitation to make an offer, to buy or sell any securities, or any options, futures or other derivatives related to such securities.

Subscribe For Free

Get the e-paper free