Surprisingly, Indian gold prices have begun to fall below some of the key Middle Eastern markets. As on November 16, 24K gold in India is quoted at ₹75,650 per 10 grams; that’s a decline of ₹110 from the previous day. While that is the case, 22K gold now costs ₹69,350 and 18K gold at ₹56,740, what remains an interesting fact is that these prices are against an upward trend across key markets of the UAE, Qatar, Oman, and Singapore, where geopolitical tensions have also been building up in a region like Israel and Gaza.
In Oman, 24K gold rose to ₹75,763 per 10 grams, up by ₹220. And in Qatar, the bullion extended gains to ₹76,293 for the same weight. Instabilities in the Middle East led to a want for gold as a security asset and also diversified the gap in their prices with India.
Gold prices drop in India but rise as the global price falls, differing with a spike in the Middle East
India’s domestic market seems to be bottoming out. Physical gold premiums rose to $16 an ounce this week, versus just $3 last week. But the global market has a different tale to tell. Spot gold had its worst weekly decline since June 2013, falling 4.5% in the U.S. to near a two-month low at $2,563.25 per troy ounce.
Analysts say this fall could be due to good economic data from the United States. The Federal Reserve has been quite careful with the rate cuts due to this fact. The higher yields on U.S. T-bonds and a strong dollar have also made it difficult for gold prices, and thus making the precious metal relatively expensive for buyers overseas۔
Did you know? Gold touched highest-ever mark in Indi in October
Although gold has fallen by the latest drop, it has surged almost 25% year-to-date, in support of central bank purchases and ongoing geopolitical uncertainties. The metal touched record highs in October but is now 7% down from that level.
In fact, while the December meeting of the Fed is now something Indian traders are keeping an eye on to determine the trajectory of gold – with prices simultaneously stuck below the ₹75,000 level, the global economic scenario as also regional factors will play a key role in determining the market’s next move.
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