Kolkata: According to morning rates recorded by India Bullion and Jewellers Association (IBJA), the price of 10 gms of gold of 999 variety stood at Rs 93,776. This was a good Rs 834 lower than the opening price on May 13. Significantly, the price of gold rose during the day’s trade on Tuesday, May 13. This was in contrast of the situation on the two earlier days of trade (May 12 and May 9), when the prices dipped during the trading session as compared to the opening morning level.
Gold is universally recognised as a safe haven metal and often its demand depends on the level of uncertainty in the economic climate. We have to watch closely how the price of the yellow metal moves on Wednesday.
Opening and closing rates in past five days
According to IBJA rates, the opening and closing prices of gold of the 999 over the past five days are as follows: (Gold 999 variety indicates a purity level of only 1 part of alloys and 999 parts of gold,)
May 13: Rs 93,942 (opening), Rs 94,344 (closing)
May 12: Rs 93,393 (opening), Rs 93,076 (closing)
May 09: Rs 96,647 (opening), Rs 96,416 (closing)
May 08: Rs 96,024 (opening), Rs 97,030 (closing)
May 07: Rs 97,493 (opening), Rs 97,246 (closing)
Two key triggers
Over the past few days, the price of gold in India has been responding mainly to two forces — the India Pakistan military conflict and the uncertainties induced by the tariff war in the global theatre introduced by US president Donald Trump. Gold has been making gains due to uncertainties going up and then again surrendering the gains as the uncertainties ebbed. As on Wednesday, May 14, the heightened uncertainties on both the trade tension and geopolitical tension across the India-Pakistan border has receded leading to expectations that spot gold prices could respond to it with a bit of cooling.
One, however, also has to keep a watch on the future prices on Multi Commodity Exchange (MCX). Also, the price of gold in New York has to be watched. There is another factor on which the price of gold depends, and that is the value of the US dollar going up or down as indicated by the Dollar index. This is because India imports a huge amount of gold every year. In fact, gold is the second most valuable item on the Indian import basket after crude oil.
Another factor that traders will keep looking for is the possibility of a US Fed rate cut. The next date for the rate-cutting committee of the US Fed is June 18. If the American central bank cuts key policy interest rate, the price of gold tends to rise. The reason: lower interest rates make gold more attractive to investors. A section of analyst have also said that this week the focus should be on US macroeconomic cues including US Core Producer & Consumer Price Index which is expected to remain stable for the last month as impact of surging US import tariffs kick in.
(Disclaimer: This article is only meant to provide information. News9 does not recommend buying or selling shares or subscriptions of any IPO, Mutual Funds, precious metals, commodity, any form of alternative investment instruments and crypto assets.)
If the geopolitical tension ebbs sustainably and the trade tension tariff war cools down, the next trigger for gold could be the meeting of the rate cutting committee of the US Federal Reserve in June apart from the movement of the dollar index. Personal Finance Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
