At Rs 6,670/gm, gold price bounces back to pre-budget rate

CHENNAI: Gold price is again moving north and almost reaching the pre-budget value as it still remains the favourite metal of Indian families.

The price of gold increased to Rs 6,670/gram and Rs 53,360/sovereign (8 gram). Cost of one gram of silver was Rs 91 on Sunday.

Gold prices crashed immediately after the Union Finance Minister presented the budget on July 23. On that morning, the price of gold was Rs 6,810/gram and by evening, it had dipped to Rs 6,550. On August 7, it reduced further to Rs 6,330/gram from which it increased steadily.

On Saturday, the price of gold reached Rs 6,670 from Rs 6,565 on Friday. In 10 days, the price of gold increased by more than Rs 300 to reach Rs 6,670 per gram.

“One of the main reasons for the rise in gold price is the geopolitical conditions in the Middle East, and Russia-Ukraine war escalation. And, the US macro data indicated that the American economy is reviving and chances of federal rate-cutting will begin from September,” pointed out Jayantilal Challani, president, Jewellers and Diamond Traders Association of Madras.

Fluctuations in the US market affect the gold rate substantially. There is a GST imposed on the gold based on the size of the jewellery. “Big brands sell the gold with GST for Rs 6,870 and others without for Rs 6,670. Currently, the average price of gold would remain the same for a while. But the silver rate will cross Rs 100 soon,” said Suresh Kumar of Shri Sumangali jewellers.