What Are The Factors That Determine Gold Price?
Not only as a prestige and wealth symbol in India but gold is considered a monetary asset throughout the world. People also have strong emotional ties to gold as it plays an important role in special occasions like weddings and religious functions.
Read>> Why Does Gold have Strong Emotional Ties?
However, in India, it is considered one of the most popular kinds of investment. Wondering why?
Because it can aid in the recovery from any financial crisis. With this comes many queries to mind like what is the gold price today, and why the prices keep on fluctuating.
Furthermore, here are the factors that determine the gold price.
The Market for Indian Jewelry
India's main source of gold demand is jewellery as it is one of the common ways for Indians to protect their riches. And when talking about Indian homes, it plays an important role. Both festivals and weddings would be lacking without a gold buy. Therefore, the price rises throughout this season as a result of increased demand.
Demand and Supply
Wondering why the Gold Price keeps on fluctuating?
Be it gold or any good, demand and supply principles govern the prices. This means with an increase in demand, the price of gold will also increase. This especially can be seen around the holiday and wedding seasons. Therefore, the gold rate today is heavily influenced by supply and demand.
Inflation
Indians favour gold investments because Gold Price fluctuates in response to inflation. This means the value of the currency decreases as inflation increases. As a result, gold is used as currency. When inflation stays high for an extended length of time, gold functions as a hedging mechanism against inflammatory situations.
Rate of Interest
The price of gold and interest rates are inversely related. With the increase in demand and a fall in interest rates, people purchase more gold. While people sell their gold as their interest rates rise and use the proceeds to invest in high-interest securities. And this is why the gold rate today per gram keeps changing.
Taxes and Import Duty
Shipments that contain gold come with Indian customs duties imposed on them. Wondering what impacts the gold rate today per gram? It is when a change in government laws results in a hike in customs duty.
Additionally, the Gold Price is also raised depending on factors like demographic region, municipal taxes, distribution costs as well as VAT. Therefore, the rise in any of these leads to the price of gold increasing.
Other Market Performance
The performance of other markets is another factor that impacts gold prices. This involves the equity and foreign exchange markets. This means investors may decide to put money in gold during a decline in those markets' prices. However, the price of gold may rise along with the demand as it rises.
Is Investing in Gold Worth it?
Wondering what the 10-gram gold price is? Will it be worth investing in gold?
The answer is simply yes and the reasons are here:
Allows to Save Money for the Future
When you make a consistent salary, it becomes essential to save money for the future. Investing in actual gold is the most straightforward thing you can do. Not only will this protect your funds for the future, but you will also earn good returns over time.
Easy to Purchase and Sell
Another reason why investing in gold is worth it is because it is easy to purchase and sell. It makes sense to get from reputable jewellers who can offer a guarantee certificate on the item.
The major benefit is that you'll receive original quality products risk-free along with having valid receipts for future use as documentation.
Requires Less Maintenance
The best thing about investing in gold is that you don't have to worry about its maintenance. You can store it safely for hundreds of years.
Besides, you can also purchase gold without any kind of risk and store it in your locker for many years without any upkeep.
Read Article: Is it safe to keep gold in a locker?
Price Stability
Another advantage of investing in gold is the price stability compared to other products on the market.
This is because the price of gold is relatively steady and does not drop even during a crisis. In reality, whenever there is a financial market crisis people start investing in gold, which as a result causes the price to surge. This has been proven for ages as investors have traditionally favoured gold because of its stability in price.
Read Article: How Stable Was the Gold Price in the Last Decade?
Consider these things Before Buying Gold
As said earlier, it is a common choice in Indian households to invest in gold. However as the prices of the one gram of gold rate today will be different from the previous month, make sure to do some research before entering the world of gold investment.
Above all, one should consider all the factors that impact the price of gold (we have already discussed the factors above).
Also, if you're planning to spend more of your hard-earned money to buy gold online, make sure you select an appropriate and reputable store.
Find out the top 10 most trusted sellers from whom you can buy gold online.
