Gold Pushed To New Records As India Demand Reignites
Date
9/27/2024 2:55:16 PM
(MENAFN- The Peninsula)
AFP
London: Gold reached record-breaking levels in September, buoyed by a bumper US interest rate cut, fears of rising geopolitical conflict, and an import tax cut in India that has galvanised local demand.
India, the world's second largest consumer of gold jewellery, cut the import tax on gold in July to six percent from 15 percent, sparking a significant increase in appetite for gold jewellery, bars and coins.
The legislation has led to "soaring" local imports of the metal which has given "fresh impetus" to its upwards price, explained Han Tan, chief market analyst at Exinity in an interview with AFP.
Gold has been smashing records throughout September, reaching a new high of $2,685.58 an ounce on Thursday, up around 30 percent from the start of the year.
The sky-high prices have also been buoyed by gold's status as a safe haven investment during times of economic and political uncertainty.
Investors have increasingly turned to the metal as conflicts in Ukraine and the Middle East unsettled markets for raw materials.
It's also been lifted by the Federal Reserve's jumbo 50 basis point interest rate cut in September.
With falling returns on dollar deposits, major central banks have shifted reserves from the greenback to gold, in a process of "de-dollarization".
The same dynamic has also benefited silver, which reached $32.71 per ounce on Thursday -- its highest price since December 2012 -- after soaring by around 35 percent in the first nine months of 2024.
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