On Wednesday, Gold prices decreased from Rs 49,247 per gram to Rs 49,117 per gram, and silver prices dropped Rs 438 to finally settle at Rs 51,355 a kg, as reported by the Indian Bullion and Jewellers Association.
India is the second-largest consumer of gold and gold’s jewelry prices vary across the country due to state taxes, excise duty, and making charges.
Gold Prices in Delhi
In Delhi, the price of 22-carat increased to Rs 47,750 a 10 gram while the price of 24-carat is Rs 48,950.
Prices in Chennai
In Chennai, the price of 22-carat traded at Rs 46,910 and the price of 24-carat is Rs 51,170.
Prices in Mumbai
In Mumbai, the price of 22-carat was trading at Rs 47,920.
On MCX, gold prices increased by 0.21 percent to Rs 49,252 per 10 gram. However, the yellow metal has struggled to increase its gains after hitting a record high of Rs 49,348 earlier this week.
Meanwhile, Silver prices edged lower on MCX. Silver futures decreased by 0.75 percent to Rs 52,650 per kg on MCX.
SEBI approved MCX for launching Gold Mini options with Gold Mini (100 grams) bar as underlying.
According to a report by the World Gold Council (WGC), investment in the yellow metal is likely to make up for the fall in consumption of the precious metal.
The report named ‘Gold Mid-Year Outlook 2020’ noted that in the present global economic situation, three factors are encouraging for investment demand for gold namely—
- high risk and uncertainty,
- low opportunity cost and
- positive price momentum
However, an economic contraction may lower their demand in the form of jewelry, technology, or long-term savings, the report added.
In terms of India, consumer demand is likely to remain soft because of decreased economic activity, increasing unemployment, and income erosion.
However, additional economic packages provided by the government and a good monsoon could reduce the negative impact of an economic contraction.