BackGold weekly price review: Wedding season fails to cheer up bullion market
Gold prices have fallen on account of two major factors jump in the exchange rate of rupee against US dollar and muted demand for gold jewellers despite wedding season.
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New Delhi: The wedding season is here but gold prices do not reflect that yet with jewellery retailers showing no great interest in buying the yellow metal. A gold price trend analysis for the week shows that it has lost ₹ 135 per 10 gram in the bullion market in Delhi. Markets are closed during weekends and on Friday, gold was trading at ₹ 32,015 (99.9% purity) and ₹ 31,865 (99.5% purity) per 10 gram.
After rising by ₹ 350 on Thursday, gold had fallen by ₹ 235 on Friday. Last week, too, the precious metal was on a downtrend and had lost ₹ 800 in five days.
Sovereign gold, however, remained flat at ₹ 24,800 per piece of 8 gram.
The week had began on a positive note for the gold market when it snapped a 5-day non-stop fall and recovered by ₹ 80 but failed to hold the momentum for the rest of the week. Muted demand for gold was the major reason for the fall in price. During October, gold imports had fallen down by about 43% to $1.68 billion.
The other big factor that led to a drop in gold prices was the exchange rate of rupee. A weaker rupee makes gold imports costlier. In the forex market, the rupee has gained during the week and is now below the ₹ 72 mark.
If the value of rupee is considered, then the outlook for gold prices over the next week also looks weak as the currency strengthened by 25 paise to 71.72 against the dollar on Friday.
However, in the gold futures market, prices rose by ₹ 54 to ₹ 30,875 per 10 gram as speculators raised their bets, taking positive cues from overseas. At the Multi Commodity Exchange, gold for delivery in December was trading higher at ₹ 30,880 per 10 grams, up 0.19%.
Gold prices in India are, however, not reflective of global trends. After falling the previous week, gold prices were up this week. On Friday, gold rose 0.17% to $1,216.10 an ounce, while silver edged up 0.14% to $14.39 an ounce in Singapore.
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