Gold prices fall 4.6% in a month

Bullion fell 1% on Tuesday; sales of jewellery surge

Gold prices have declined by 4.6 per cent

from their lifetime high of ~39,031 per 10g the bullion hit on September 4 this year. Spot gold declined by 1.5 per cent to hit the lowest in almost two months in early Tuesday trade. But it recovered by half towards evening on huge customer turnout.

Spot gold declined by 1.5 per cent to hit the lowest in almost two months in early Tuesday trade. But it recovered by half towards evening on huge customer turnout to book their share on price fall. The decline in gold prices in the domestic market was followed by a similar move globally, on easing trade tensions between the US and China, albeit temporarily.

Standard gold (.995 purity) i n Mumbai’s popular Zaveri Bazaar slumped to ~36,924 per 10 gram on Tuesday morning. This level has not been seen since August 7. Buyers, waiting for a correction ahead of the peak Dussera and Diwali season, saw this as an opportunity to buy the yellow metal.

The decline, however, was followed by a similar move in the international markets, which recorded 5.5 per cent fall since September 4 to trade currently at $1,468 per ounce (oz).

The sudden upsurge in demand has not only helped in the recovery of prices, but also narrowed the discount to ~80 per 10 gm on Tuesday, against ~160 a week ago.

“While the fundamentals remained strong in favour of gold, the correction in price was overdue. This proved a blessing in disguise for the Indian consumer. Going forward, there is limited downside,” said Gnanasekar Thiagarajan, director, Commtrendz, a city-based commodity broking firm.

In fact, prices have declined by 4.6 per cent from their lifetime high of ~39,031 per 10 gm the bullion hit on September 4 this year. “We have seen 15-20 per cent increase in our daily average sales on Tuesday,” said Kumar Jain, director, Umedmal Tilokchand Zaveri, a jewellery retailer in Zaveri Bazaar.