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Know Why Gold Prices Are Rising In India Even During the Pandemic
By Recently, the gold prices in India hit a nine-year high reaching Rs. 50,000 per 10 grams. The situation has been the same for the past few months. While the country’s economy is dealing with crisis due to coronavirus, gold prices are continuously going up.
And this makes us question – What is the reason behind this increase in the gold price during times of crisis? Will it keep rising in the upcoming months? Read on to know.
Why Gold Prices Are Going Up?
In the first half of 2020, gold has witnessed a remarkable performance. Not only did gold’s price increased by around 25 percent in March, but it also outperformed all other asset classes. Western investors are piling into the gold since it is safer than other investment options. This has led to the push-in gold prices.
For the past few months, international gold prices are going up amidst sharp losses in dollars. As per experts, the U.S. and European investors are quite interested in the gold since it is a safe haven for investment.
In an interview, Steve Dunn, head of ETFs at Aberdeen Standard Investments, said, “The demand for gold in 2020 has been almost exclusively supported by investment demand.”
This is the same for investors in China and India – the biggest gold markets in the world. This is terribly affecting Asian shoppers and they are changing their minds when it comes to buying gold.
Not just this, due to COVID-19 spread, trade flows have also been affected by the gold imports dropping by about 99% in April and May.
The prices rise is also the same for silver. Just like gold, silver is also becoming a safe haven for investors all over the world.
What’s In the Future?
Though it is difficult to predict anything for now, market experts are assuming that the prices may go up further. According to experts, the momentum for gold prices is there but there is no certainty in commenting that this increase will continue since the factors are changing every passing day.
In such a situation, the common people are having a hard time buying gold and silver. And this will continue until the pandemic brings some recovery in other asset investments.