Gold Prices in India Pull Back from Life-Time High Following Global Cues

The gold prices in India which had hit a lifetime high ahead of the Akshaya Tritiya season have pulled back due to the revival of the dollar index from its one-year low of 100.80 levels.

Gold Prices in India Pull Back from Life-Time High Following Global Cues

The gold prices in India today were trading at Rs 55,950 for 10 grams of 22 karats and Rs 61,040 for 10 grams of 24 karats. The metal has slid by Rs 700 for 10 grams of 22 karats and Rs 760 for 10 grams of 24 karats respectively from the previous day's prices.

The yellow metal had started the week on a bearish note, after last week's non-farm payrolls data showed that the U.S. economy witnessed an addition of 236,000 jobs in March, with the unemployment rate declining to 3.5 per cent. The situation has underscored the U.S. Federal Reserve's calls for further rate hikes in the coming days.

Gold and the dollar share an inverse relationship. The yellow metal acts as a safe-haven asset amidst economic or political turmoil. On the other hand, the U.S. dollar has declined the appetite for bullion amongst overseas buyers.

Patrick Harker, Philadelphia Federal Reserve Bank President noted that he feels that the U.S. Fed may soon be done with hiking interest rates, while Minneapolis Federal Reserve Bank President - Neel Kashkari said that he believes inflation, now at a rate of 5 per cent by the Fed's pressured measure, will get to the mid-threes by the end of this year 2023.

Recently, the International Monetary Fund (IMF) has revised its global growth outlook to 2.8 per cent down from its previous forecast of 2.9 per cent for 2023 and to 3 per cent for 2024 from its earlier forecast of 3.1 per cent. The IMF has cited tight policy stances required to bring down the prevailing inflation rates amidst the fallout from the recent deteriorating financial conditions, growing geo-economic fragmentation and ongoing tensions in Ukraine.

The demand for gold in India will be usually high during the auspicious period of Akshaya Tritiya. But this time, the expensive prices of gold may take a hit on the gold demand in India. It is believed in India, that purchasing gold on this festive occasion will guarantee endless wealth.