Gold prices are falling, oil is down and most of the metal prices are down. A strengthening USD coupled with anemic global economic growth is pulling down commodity prices. Weak commodity markets help countries like India to contain its fiscal and current account deficit as subsidy bill comes off and import bill on oil and gold comes off. Oil and gold account for close to 45% of India’s imports while fuel and fertilizer subsidy accounts for 50% of India’s total subsidy bill. India will be able to contain its fiscal and current account deficit leading to drop in inflation expectations and improved economic growth prospects as interest rates come off in the economy.
- 75% respondents agree that gold prices can go down further after touching five year low levels.
- 48.21% respondents say that they will buy gold but not for investment.
- 61.11% participants have a negative outlook on commodity prices as all indicators point to weak commodity prices
- 78.95% respondents are correct in identifying the reasons why gold prices have tumbled in the recent past.
- 70.18% respondents think that gold prices will be in a range of Rs 20,000 and Rs 25,000 per 10 grams one year down the line.