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Old jewellery sales in India are surging as gold prices pass the Rs 60,000 mark



Old jewellery sales in India are surging as gold prices pass the Rs 60,000 mark

The sale of old gold jewellery spiked on Wednesday, coinciding with the start of India’s domestic new year which is marked by multiple festivals such as Navaratri, Ugadi and Gudi Parwa. This was more on account of the spike in gold prices to a record Rs 60,000 per 10 gram than the festive spirit.

Historically, the months of February and March are known to witness a dip in gold buying owing to the onset of tax saving season. This season also witnesses more instances of gold monetization since people sell their jewellery to invest in tax saving instruments ahead of the close of the financial. Some people also sell jewellery during this season to invest in their children’s education. These annual trends coincided with the rise in the gold prices.

On Monday, gold futures were priced at $2,021.70 per ounce, a rise of more than 1.50 per cent.

The rise in price of gold was spurred by market volatility ahead of the US Federal Reserve’s monetary policy decision. The decision was in greater focus owing to a challenging situation posed by the shuttering of two banks in the US, and the merger of Swiss lender Credit Suisse with its rival UBS, owing to a decline in its stock value.

A rise in value of gold is a clear indicator of market volatility and investor fears. During most of 2022, the US dollar gained in value since global investors turned to the American currency to preserve their wealth, withdrawing from stock markets and other risky investments. However, the rise in price of gold indicated that the yellow metal outshone the US dollar in terms of stability and investor faith as a store of value.


Gold prices briefly cooled down after the US Fed announced a 25 basis points policy rate hike on Wednesday.

 On Thursday, gold prices spiked again by 2.67 per cent to $2,109.20 per ounce as the Fed took a dovish stance indicating that inflation is expected to remain elevated.

“Gold is becoming a favourite trade on Wall Street as many traders remain nervous post-Fed and over how quickly will US authorities be able to contain further banking turmoil,” said Ed Moya, Analyst at Oanda. The price rally is guided by a rise in US jobless claims, he added. With the labour market remaining tight, traders are in a bind about Fed rate hikes going forward, said Moya.

Content credits: News 9 Live

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