Sidheshwar Shirsath, who lives on the outskirts of India’s financial capital, Mumbai, began buying gold for the first time when he got married nine years ago.
Shirsath, 35, works as a driver and gets about 55,000 rupees ($ 889 of CDN) monthly. He decided that gold may be a good way to build an egg for the future of his family.
Whenever he had some money to spend, he bought gold jewelry, including rings and bracelets, and now has about 130 grams of gold, at a value of more than a million rupees ($ 16,000 CDN).
“At some time after I bought gold for the first time, the prices started to increase, so my interest in investing in it has grown.”
In recent months – with his secrets – the price has risen.
Gold was traded worldwide at 3,298 dollars for an ounce on Friday morning, an increase of more than 25 percent since the beginning of the year, and an increase of 42 percent compared to last year.
The value of gold worldwide It rose amid global economic uncertainty Geopolitical tensions, including concerns about the influence of the tariff policy of US President Donald Trump.
The precious metal is often seen as one of the “safe haven” assets to which investors flow during periods of economic turmoil.
“Gold is part of the social fabric”
In India, the price increased more severely and increased by 30 percent since the beginning of the year – with an additional increase in the decrease in the value of the rupees against the US dollar.
But for many Indians, such as Shercath, gold is more than investment.
“Gold is very close to Indian women,” said his wife, Manisha, who sits next to him in her modest house, decorated with a heavy golden diameter and glamorous bracelets. “They need gold – especially for festivals and wedding parties.”
In India, it is primarily purchased in the form of jewelry because it can be a way to show the individual’s wealth and position. The precious metal also carries Huge religious and cultural importance.
It is part of the dowry at weddings, for example, and the auspicious is considered to buy gold during some Hindu festivals.
“India is a unique gold market,” said Sashin Jain, the regional CEO of India at the World Gold Council, a global association in the field of industry. “Gold is part of the social fabric, and does not need to be in certain economic layers for gold consumption.
“We all in India have a family doctor, so we say, and we have a family jeweler.”
India is among the largest golden consumers in the world
Jane said that in the countryside of India, where most of the 1.4 billion people in the country still live – and with a lot of access to bank accounts – gold is a common way to store savings.
All this means that India is one of the largest consumers in the world of gold, with the country’s demand for precious metals that reach about 800 tons annually.
However, the sharp price is to affect the amount of metal that people buy.
“With jewelry consumption, the higher the price of gold, the consumer and watches are waiting,” said Jain. “The moment when a bit settlement is made, we see consumers come back.”
The data of the World Gold Council shows that the demand for gold in India in the first three months of this year amounted to 118.1 tons, a decrease of 15 percent compared to the first quarter of last year.
But since the price has increased, the value of the demand for gold in the country – the amount of gold that is purchased or investing – in the first quarter of this year actually increased by 22 percent, to reach 940 billion rupees ($ 15.1 billion from CDN).
“People buy fewer quantities,” said Colin Shah, Managing Director of Kama Jewelry, a manufacturer in Mumbai. “They all have budgets. If someone has $ 2000 to spend, they will spend it and buy a fewer size.”
But he said, that gold in no way lost its brilliance, despite its high price.
“In India, there is a culture of gold, and no one will stop buying gold because of the prices,” Shah said. “In fact, they will have more confidence in the category because of the return they earn on their money.”
Investing in gold digitally high
With the appetite of the Indians to own gold, no signs of mitigation show, the government has taken a series of steps in recent years to try to ensure gold to the official economy.
This includes reducing the duty to import gold last year to six percent from 15 percent, partly as a way to make it less attractive to people to smuggle gold to the country to avoid paying high taxes.
The government also provides sovereign golden links as a substitute for material gold.
Jin from the World Gold Council said that the Indians are increasingly investing in gold digitally, for example, through the boxes circulating on the stock exchange (ETFS)-and it encouraged the price increase only people to look at these options.
“The young generation gets more and more intelligence, and easily technology, we believe that investing in gold and gold assets will get more digital,” he said.
The demand for gold investment, including traded investment funds, increased by seven percent in India to 46.7 tons in the first quarter, according to the World Gold Council.
Jpmorgan Expectations that the price of gold It can reach $ 4,000 ounce next year.
Shercath said that he and his family have more than enough jewelry now, but he still wants to continue buying gold.
“My next plan is to buy gold coins or go to bonds.”
Gold has long been seen as a stable investment, and at a time of global uncertainty, it has become very common that the Big Box stores like Costco jumped on the cart.
https://i.cbc.ca/1.7548247.1748628985!/fileImage/httpImage/image.jpg_gen/derivatives/16x9_1180/customers-look-at-gold-items-in-a-jewelry-store.jpg?im=Resize%3D620
Source link