A dramatic drop has occurred in home spot prices of gold. In the bullion market of Delhi, capital of the country, gold of 99.9 percent purity is quoted at few points by which its price stands at Rs 1,400 down from the initial levels of Rs 79,500 per 10 grams. The 99.5 percent purity gold price also stood as much lower: Rs 79,
Likewise, data indicate a huge downturn in prices of silver, spot prices showing Rs 4,200 decline as against the previous value of Rs 92,800 per kg. This drop is viewed as perhaps the biggest in the month of December, shaking things up in the market.
What might be the reason that gold has gone down?
Recently, gold prices have obviously surged, reaching their 5-week peak. But on Friday gold actually experienced a sizable drop. According to experts, the main reason for all this is heavy selling by jewelers and stockists. The fall in the USA’s producer price index (PPI) and an increase in weekly unemployment claims, reaching fever-pitch profit booking by investors, has driven this development further.
They, however, added that against a back ground of dollar demands and mixed macroeconomic data releases regarding the US economy, this downward sale made a totally panicked force in the market, raising caution among traders ahead of last policy session of the Federal Reserve.
Will it go up or will it go down?
Though gold prices have fallen, expectations exist that the market will improve in the coming week. Such possibilities arise from anticipation over interest rate cuts in the United States. According to econometricians, there is a 97% chance that there will be a 0.25% cut in interest rates at the US Federal Reserve meeting, which will be held in December 17-18, which may positively impact gold prices and attract more interest from traders and investors.
