(The Hindu) – Gold price dropped in India’s National Capital Region on heavy sell-off in overseas markets.
India, the world’s number one gold consumer, is a key indicator for the future of gold price. It consumes gold in every known form, except gold ETFs, which wasn’t popular in the physical gold loving country.
Gold price in India fell from 28,400 rupees per 10 grams to 28,000 per ten grams on Thursday. Gold reached its lowest value in more than 2.5 years. Indian traders believe that this recent fall is due to Bernanke’s announcement yesterday, saying that the U.S. Federal Reserve might tap their bond purchasing later this year.
The Indian investors said, weak rupee “cushioned” the drop to some extent. The Indian rupee record a historic decline versus the American dollar which made gold imports more costly. Moreover, the Indian government took desperate measures to lower gold imports to the extreme during the past 6 months.
Physical gold of 99.9 and 99.5 purity prices fell by 400 rupees. While Indian gold coins lost 200 rupees to be sold by 24,200 per eight gram coin.
The price trend of gold in India is normally set by London’s gold fix. The price of gold in London fell by 3.4%, reached the lowest since September 2010.