Your Dhanteras shopping may turn expensive; gold price in Mumbai seen edging higher
As gold is considered the biggest symbol of wealth and prosperity, rising price can be a reason to worry, especially in this cosmopolitan, yellow metal-loving city.
With just a few days left for Diwali festival, bad news is seen knocking on Indian doors. It is expected that gold price will jump higher in the festive season, which will make it quite expensive for citizens who purchase the yellow metal in heavy amounts during the auspicious occasion Dhanteras. The five-day Diwali festival will begin with Dhanteras – also known as Dhanatrayodashi or Dhanvantari Trayodashi, on November 07, 2018. On this day, jewellers usually see massive rise in demand for yellow metal every year either in the form of jewelry or coins. Usually, during festivals gold price tends to inch up, because of the rise in demand.
As gold is considered as the symbol of wealth and prosperity, rising prices of this metal can be a reason to worry especially in the city of Mumbai. However, considering the city being a financial capital majority of citizens opt to buy gold from this hub during the festive season.
Gold price hike for a month in Mumbai.
On Sep 30, 2018, rate of 24 carat gold was at Rs 32,430 which rose further at Rs 33,210 within 15 days on Oct 15, 2018. As the Dhanteras festival nears, there is no stopping the rise of gold price and it has touched an all-time high of Rs 33,360 on October 16, 2018. Today, gold was priced at Rs 33,310.
On the other hand, on Sep 30, 2018, the rate for 22 carat gold was at Rs 30,080 which further increased at Rs 31,300 within 15 days on Oct 15, 2018 and later clocked an high of Rs 31,450 on Oct 16,2018. Today the rate of 22 carat gold is at Rs 31,260.
According to Goodreturns.com report, gold rates in Mumbai today depend on a host of factors that are largely internationally dependent. For example, one classic reason for gold prices going higher recently is the supply constraint. Over the last few years, we have seen that production has seen some serious decline.
The decline in gold production was more than 40% over the last few years.
Thereby, this could lead to prices moving higher in most cities of the world, including Mumbai. Apart from supply there are other reasons why gold prices tend to go higher.
If the mining activity deteriorates, it is highly likely that we may see some supply constraints which could push gold prices lower. So, watch out for some of these supply pressures, which could push gold prices in Mumbai lower, added the report.
However, the report further explains on how much of new gold discoveries would happen is the big question these days. It would depend on the mining that takes place in the important towns and cities of the country.
The price movement in gold depends on a list of factors. Firstly, it is fixed by Indian Bullion Jewellers Association. This institution fixes the price taking into account - the rates fixed by largest dealers in the city, local import duty added on import items and while some dealers derive prices based on some formula prepared by in the futures market of the MCX.
Buyers, of course, will be keenly watching the oscillation in the price of gold at Dhanteras and hoping there is no further increase at least..