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Gold shines as price hits all-time high, but demand loses lustre

Even as physical demand is absent, investments in paper gold are pushing the price of the yellow metal to record highs

Topics
Gold Prices | Gold  | Gold ETFs

Rajesh Bhayani 

gold
Digital gold has witnessed increased interest

The price of in India is almost at an all-time high, even as demand is thin. According to Metal Focus, a leading consultancy, jewellery demand is likely to fall 36 per cent to just 348 tonne in 2020, the lowest in a decade. It said the rural economy, which is better placed, and low-key weddings are likely to drive jewellery buying.

Even as physical demand is absent, investments in paper ETFs and (SGBs) — are pushing the price of the yellow metal to record highs.

Also, digital gold has witnessed increased interest, but in quantity terms, this mode of investing in physical gold is only a fraction of the overall investment in this safe haven product.

Outlook

A decline in overall consumer savings is likely to undermine gold investments. Instit-utional investors may continue to buy SGBs.

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First Published: Wed, July 01 2020. 01:47 IST
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