Gold price hits all-time high

Ignatius Pereira

Previous retail price high was Rs.1,275 in November last

International price stood at $899.40

Exchange rate of rupee is making the difference

KOLLAM: Retail gold trade in the State considerably tapered on Saturday as price of the precious metal hit at all time high in the country.

The price went up to Rs.1,285 a gram (Rs.10,285 a sovereign). Compared to the price that stood at Rs.1,255 a gram on Friday (Rs.10,040 a sovereign), it was a big jump on Saturday, traders said.

The previous retail price record was in November last year when the price reached Rs.1,275 a gram (Rs.10,200 a sovereign).

From there it went down to Rs.1,200 a gram (Rs.9,600 a sovereign). And for all that, the price of gold on January 24 last year was Rs.1,050 a gram (Rs.8,400 a sovereign).

The interesting aspect of the present price position is that the international price of gold on Saturday stood at $899.40 per ounce, whereas when the retail price in India was Rs.9,960 a sovereign, the international price touched $1,032.70 (March 17, 2008) per ounce, said S. Abdul Nazar, vice-president of the All Kerala Gold and Silver Merchants Association.

But the exchange rate of the rupee against the U.S. dollar is making the difference. When the price was $1,032.70 per ounce in the international market, the exchange rate was Rs.38 a dollar and now it is Rs.49.25 a dollar. Mr. Nazar said the accumulation of gold Exchange Traded Fund (ETF) could be the reason for the situation.

He said that gold price was showing a climbing trend as a result of which business was dull. Gold traders said the price rise was of no use if there was no sale. At the same time, there was rush in retail gold outlets for selling the ornaments. Ram Mohan Kamat, secretary of the Calicut Bullion Traders Association, said that Friday’s aggressive gold ETF could be the prime cause for the sudden jump.

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