Hyderabad: Gold price in Hyderabad continues its southward journey on March 10, 2021. On Wednesday, the price of 10 grams of 22-carat gold has fallen down to Rs. 41, 640 as per the Good Returns website.
The gold price in Hyderabad has touched a record high in August last. In the month, the highest price of 10 grams of 22-carat gold was Rs. 54, 200.
Factors responsible for gold price in India
Although, there are many factors responsible for the rise or fall in gold price in India, following are the top five.
- Gold reserve
- Global impact
- Seasons, festivals.
- Interest rate
Whenever inflation increases, the purchasing power goes down. In such a situation, investors start purchasing gold in one or the other form as it is considered a safe haven.
As a result of the huge purchases, the price of gold starts increasing due to demand and supply mismatch.
The price of gold also rises whenever Central Banks start procuring it. It happens due to an increase in the supply of cash in the market.
As India is the largest importer of gold, global impact plays major role in the rise or fall of gold price.
Gold which is known as a safe haven is preferred by investors whenever there is instability in any part of the world.
Wedding seasons, festivals
In India, during wedding season and festivals, people prefer to buy gold jewelry due to which demand increases.
Apart from it, the yellow metal is also used in small quantities in the manufacturing of some electronic devices.
Thus due to the rise in demand for jewelry and some electronic devices, the gold price goes up.
It also plays predominant role in deciding the gold price in India.
Whenever, interest rate goes down, the flow of cash in the market increases thereby rise in demand for gold.
With the increase in demand, the gold price climbs up.