In America, gold and silver rose as interest rate hikes broke: demand for weddings was affected

- Boolean Bits - Dinesh Parekh

- Signs of interest rate cuts in the US starting next year saw gold prices rally against a retreat in the global dollar.

In the jewelery markets of the country, there has been a huge jump in the prices of gold and silver recently and there are indications that jewelers and market players have become stunned amid the unprecedented turmoil in the market. Market experts are saying that such price fluctuations have appeared in the wake of the global market. According to the directives flowing from the United States, after the Federal Reserve has been increasing the interest rate frequently during this year 2023, now in the coming new year of 2024, instead of increasing the interest rate in the United States, the interest rate will begin to decrease. It has had a wide impact on various markets. As the US interest rate hike cycle is now coming to an end and indications are flowing that the cycle of interest rate cuts will begin further, the global index of the dollar fell sharply against various major currencies at the global level. There was news that the price has crossed the level of 2000 dollars per ounce. Behind gold in the world market, silver prices also rose sharply. As the prices rose in the world market, the import cost of precious metals at home increased rapidly overnight, and due to this, there was a rapid increase in the prices of gold and silver by 3 to 4 percent, causing widespread panic in the market. In the new year of 2024, the interest rates in America will be reduced approximately three times, the experts of the world market were showing the possibility. At present, the range of interest rates in America is around 5.25 to 5.50 percent, but the global policy makers and experts were showing the calculation of falling to around 4.40 to 4.90 percent next year.

In addition to gold and silver in the world market, there was news of a record breaking boom in the global stock markets as well. Analysts were showing the possibility of interest rate reduction starting from March next year in America. After the global gold prices hit a low of 1973 to 1974 dollars per ounce on Wednesday, there were indications that the global gold prices rose like a spring to reach a high of 2039 to 2040 dollars. Behind gold, the global silver prices were also seen rising from 22.60 to 22.61 dollars per ounce at a low of 23.98 to 23.99 dollars near 24 dollars. Behind the global market, even in the home jewelery markets, the price rise of 3 to 4 percent was visible, so new demand was suppressed in the market. The market informants were also showing fear that seasonal demand will be affected as the price of Lagnasara Tanne increases.

The global dollar index, which had touched a high of 104, was seen trading at a low of 102.40 to 102.45, rising sharply to within the 103 level following signs of a Federal Reserve rate cut. Behind the world market, there were indications that the price of the dollar was on the decline against the rupee in the domestic currency market. Gold prices rose by Rs.1200 to Rs.1400 per 10 grams due to the global boom in the country's jewelery markets, while silver prices saw a sharp jump of Rs.3000 per kg. In the Mumbai market, the price of gold rose to Rs.62,000 without GST, while the Mumbai silver price rose to Rs.74,000 without GST. In the Mumbai jewelery market, gold and silver prices with GST were three percent higher than this price. The news from the jewelry markets of Ahmedabad and other cities of the country were also showing a sharp rise in prices.

There was news that the central banks of various countries of the world have bought gold extensively this year in 2023. The global experts said that the total purchase of these central banks has crossed the level of 1000 tons this year. Last year also in 2022, such purchase was over 1000 tons during the year. Thus, for two consecutive years, such central banks have been significantly active in the global gold market. In the current year of 2023 compared to 2021, such purchases have increased approximately two and a half times, while compared to 2020, such purchases have increased four times, the informants said. At present, the various central banks of the world hold approximately 20 percent of the total reserves in the form of gold and these central banks have plans to increase this percentage to 40 percent in the future. Ten years ago such annual purchase was around 600 tonnes and in 2022 such purchase crossed the 1000 tonne level for the first time.