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Gold June 04, 2013 06:30:54 AM

Don't catch the falling knife, warns Indian gold market research firm

Paul Ploumis
ScrapMonster Author
A leading market research firm in its recent report has highlighted that the gold prices are likely to fall further

Don't catch the falling knife, warns Indian gold market research firm

NEW DELHI (Scrap Monster) : A leading market research firm in its recent report has highlighted that the gold prices are likely to fall further and has advised buyers not to hurt themselves by rushing to buy into gold.

The recent study conducted by ICICI Securities predicts that the gold prices may slip to levels of $1,250 to $1,280 per troy ounce by end of FY14. The advisory firm strongly believes that the ‘commodity super-cycle’ is nearing its end.  The volatility of gold is to remain at elevated levels for the next six to nine months. The investors and retail buyers who are convinced of a further fall in gold prices would stay away from buying gold, which obviously would result in weak demand.  

After plunging to its lows by mid-April, the gold prices managed to make a feeble recovery. The increased retail demand triggered by auspicious occasions and marriage season pushed the Indian gold prices higher. The retail demand for gold has already started showing signs of slow down towards end of May.

The ICICI Securities research report concludes by stating that in the short term global gold prices will drift to substantially lower levels. Consumers may better wait for more declines to buy more.

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