Gold Price Alert: Gold prices in India are falling following weakness in global markets and US policy changes. The impact of reciprocal tariffs imposed by US President Donald Trump has put pressure on gold prices. Recently, the price of 24 carat gold fell by Rs 540 per 10 grams during the last week, while the price of 22 carat gold has seen a decline of Rs 500 per 10 grams.
According to US experts, gold prices may fall by up to 38%. If this happens, the price of 10 grams of gold in India may fall below ₹ 56,000. On April 4, gold prices fell by ₹ 1,600 in a single day, causing a stir in the market. So has the phase of decline in gold prices started now? Let’s know the reasons behind it.
Decline in gold prices – Will the decline continue now?
In the last few months, gold prices were skyrocketing, which was proving beneficial for investors, but it had become difficult for the general public to buy gold. After crossing the record level of Rs 93,000 per 10 grams in the last few days, now there are signs of decline in gold prices. The fall of Rs 1,600 on April 4 surprised everyone. Is this just a temporary decline, or can the price of gold come down further in the coming days?
Why can the price of gold come down to Rs 56,000?
John Mills, strategist at American research firm ‘Morningstar’, says that the price of gold in the global markets can fall from $3,100 per ounce to $1,820 per ounce. This will also affect India, and the price of 24 carat gold can reach ₹ 55,000-56,000 per 10 grams. It is worth noting that 1 ounce contains 28 grams of gold, and if prices fall by 38-40%, then this estimate may prove to be correct.
Reasons for fall in gold prices:
1. Increase in production: Gold production has increased worldwide. Mining activities have intensified in countries like Australia and old gold is also coming back. This has increased the gold reserves by 9%, which has now reached 2,16,265 tonnes.
2. Decrease in demand: Central banks bought 1,045 tonnes of gold last year, but now their purchases are likely to decrease. In a recent survey, 71% of the banks plan to reduce or keep gold purchases stable.
3. Market stagnation: Mergers and acquisitions of gold mining companies have increased by 32% in 2024. Apart from this, investment in gold-ETF has also increased, which is putting pressure on prices.
Are all experts unanimous?
Not all experts are unanimous about gold prices. While some experts are predicting a decline, Bank of America estimates that the price of gold may reach $3,500 an ounce in the next two years. At the same time, Goldman Sachs has also set a target of $3,300 an ounce by the end of 2025. In such a situation, it is important for investors and buyers to understand that there will be volatility in the market, and gold prices may change further in the future.