Gold has always held immense value in Indian culture, symbolizing wealth and serving as a popular investment option. As the second-largest consumer of gold globally, India’s relationship with this precious metal is significant.
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In this blog, we’ll discuss how economic recessions, political uncertainties, and shifts in global supply and demand can all have an impact on the price of gold in India. Understanding these factors can help us understand why gold prices change and what it means for people who buy and invest in gold.
Gold Price in India From 1964-2023
Here is a comprehensive gold price chart showcasing the historical gold prices in India from 1964 to 2023:
| Year | Average Gold Price (24 karat per 10 grams) |
|---|---|
| 2023 (as in December 2023) | Rs.64,490 |
| 2022 | Rs.52,670.00 |
| 2021 | Rs.48,720.00 |
| 2020 | Rs.48,651.00 |
| 2019 | Rs.35,220.00 |
| 2018 | Rs.31,438.00 |
| 2017 | Rs.29,667.50 |
| 2016 | Rs.28,623.50 |
| 2015 | Rs.26,343.50 |
| 2014 | Rs.28,006.50 |
| 2013 | Rs.29,600.00 |
| 2012 | Rs.31,050.00 |
| 2011 | Rs.26,400.00 |
| 2010 | Rs.18,500.00 |
| 2009 | Rs.14,500.00 |
| 2008 | Rs.12,500.00 |
| 2007 | Rs.10,800.00 |
| 2005 | Rs.7,000.00 |
| 2004 | Rs.5,850.00 |
| 2003 | Rs.5,600.00 |
| 2002 | Rs.4,990.00 |
| 2001 | Rs.4,300.00 |
| 2000 | Rs.4,400.00 |
| 1999 | Rs.4,234.00 |
| 1998 | Rs.4,045.00 |
| 1997 | Rs.4,725.00 |
| 1996 | Rs.5,160.00 |
| 1995 | Rs.4,680.00 |
| 1994 | Rs.4,598.00 |
| 1993 | Rs.4,140.00 |
| 1992 | Rs.4,334.00 |
| 1991 | Rs.3,466.00 |
| 1990 | Rs.3,200.00 |
| 1989 | Rs.3,140.00 |
| 1988 | Rs.3,130.00 |
| 1987 | Rs.2,570.00 |
| 1986 | Rs.2,140.00 |
| 1985 | Rs.2,130.00 |
| 1984 | Rs.1,970.00 |
| 1983 | Rs.1,800.00 |
| 1982 | Rs.1,645.00 |
| 1981 | Rs.1,800.00 |
| 1980 | Rs.1,330.00 |
| 1979 | Rs.937.00 |
| 1978 | Rs.685.00 |
| 1977 | Rs.486.00 |
| 1976 | Rs.432.00 |
| 1975 | Rs.540.00 |
| 1974 | Rs.506.00 |
| 1973 | Rs.278.50 |
| 1972 | Rs.202.00 |
| 1971 | Rs.193.00 |
| 1970 | Rs.184.00 |
| 1969 | Rs.176.00 |
| 1968 | Rs.162.00 |
| 1967 | Rs.102.50 |
| 1966 | Rs.83.75 |
| 1965 | Rs.71.75 |
| 1964 | Rs.63.25 |
Factors That Influence Gold Price in India
- International gold prices: Changes in global gold prices directly affect the price of gold in India due to factors like trade, investment flows, and market sentiment.
- Indian Rupee exchange rate: The exchange rate between the Indian Rupee and the US Dollar impacts the gold price in India. A stronger Rupee lowers the price, while a weaker Rupee raises it.
- Inflation and economic conditions: Gold is considered a safe investment during periods of inflation and economic uncertainty, leading to increased demand and higher prices.
- Interest rates: Lower interest rates make gold more attractive to investors, while higher rates reduce demand and potentially lower prices.
- Government policies and regulations: Policies related to gold imports, customs duties, taxation, and trading regulations can affect the gold price in India by influencing supply and demand.
- Seasonal demand: Festive and wedding seasons in India see higher gold buying, resulting in increased demand and potentially higher prices. Cultural traditions and specific occasions drive this seasonal demand.
Why Invest in Gold in India?
- Hedge against inflation: Gold is often considered a reliable hedge against inflation. As the value of currency decreases due to inflation, the price of gold tends to rise, preserving purchasing power. (Hedge against inflation means having investments or assets that protect your money from losing value when prices go up, like gold, which tends to hold its value or increase in price during inflation.).
- Diversification: Investing in gold can provide diversification to an investment portfolio. Gold has a low correlation with other asset classes like stocks and bonds, which means it can help reduce overall portfolio risk.
- Store of value: Gold has been recognized as a store of value for centuries. It retains its worth over time and can be easily converted into cash when needed.
- Safe asset: During times of economic uncertainty or market volatility, investors often turn to gold as a safe asset. It provides stability and acts as a safeguard against financial instability.
- Cultural significance: Gold holds immense cultural significance in India. It is a part of various traditions, festivals, and occasions, making it a preferred choice for gifting and personal adornment.
- Liquidity: Gold is highly liquid, meaning it can be easily bought or sold in the market. There is a well-established infrastructure for buying and selling gold in India, ensuring ease of transactions.
- Long-term investment: Gold has demonstrated long-term value appreciation. While short-term fluctuations are common, historical data suggests that gold prices have generally risen over the long run.
- Global demand: Gold is in demand worldwide, which creates an active market for buying and selling. This global demand contributes to the liquidity and value of gold investments.
- Accessible investment options: There are various investment avenues available for investing in gold in India, such as physical gold (jewellery, coins, bars), gold ETFs (Exchange Traded Funds), gold mutual funds, and gold savings schemes offered by banks and financial institutions.
Also Read: Planning to Buy Gold in Dubai? Pros and Cons You Need to Know
Who Should Invest in Gold in India?
| Type of Investor | Reasons to Invest in Gold |
|---|---|
| Individual investors | Hedge against inflation, diversify investment portfolio, store of value, long-term investment, cultural significance |
| Risk-averse investors | Safe haven asset during market volatility or economic uncertainty |
| Retirement planners | Portfolio diversification, protection against inflation, long-term wealth preservation |
| Savvy investors | Take advantage of potential price appreciation, liquidity, global demand |
| Individuals with a cultural affinity for gold | Cultural significance, gifting, personal adornment |
| Individuals seeking liquidity | Easily convertible into cash, well-established market infrastructure |
| Investors looking for portfolio insurance | Protection against unforeseen events, stability during economic downturns |
| Long-term wealth builders | Historical appreciation of gold prices, long-term store of value |
When is the Right Time to Invest in Gold in India?
- Market conditions: Monitor the overall market conditions, including the price of gold, trend analysis, and market sentiment. Look for opportunities when gold prices may be relatively low or expected to rise.
- Economic indicators: Pay attention to economic indicators such as inflation rates, interest rates, and geopolitical events. Gold prices often rise during times of economic uncertainty or when inflation is expected to increase.
Also Read: Investing in Sovereign Gold Bonds Online
Popular Digital Gold Investment Options in India
In India, there are a few popular digital gold investment options available. These platforms allow investors to buy and sell gold online, providing a convenient and accessible way to invest in gold. Here are some prominent digital gold investment options in India:
- Gold ETFs (Exchange-Traded Funds): Gold ETFs are open-ended mutual fund schemes that invest in physical gold. They are traded on stock exchanges like regular stocks. Investors can buy and sell units of gold ETFs, which represent a certain quantity of gold, through a demat account.
- Gold Savings Funds: Gold savings funds are mutual fund schemes that invest in gold ETFs. Instead of directly buying and selling gold ETF units, investors can invest in gold savings funds through their mutual fund investment accounts.
- Paytm Gold: Paytm Gold is a platform that offers Indians a convenient and transparent way to buy, sell, gift, and receive 24-karat gold. To ensure the highest quality of gold for its customers, Paytm has partnered with MMTC-PAMP, which operates the largest BIS authorized and internationally accredited gold refinery in India. When a customer purchases gold through Paytm, MMTC-PAMP securely stores an equivalent quantity of 24 karat 99.99% pure gold in 100% insured vaults at their protected premises. Customers can easily check their gold balance on the Paytm App and have the flexibility to sell, gift, or opt for delivery of their gold at any time and from anywhere.
- Sovereign Gold Bonds (SGBs): Sovereign Gold Bonds are issued by the Government of India. They are denominated in grams of gold and offer an opportunity to invest in gold withoutphysically owning it. SGBs have a fixed tenor and provide an additional interest rate on the invested amount.
- Gold Trading Platforms: Some online platforms enable users to trade gold digitally, similar to stock trading. These platforms provide a marketplace for buying and selling gold digitally, allowing investors to take advantage of price fluctuations and trade gold as a financial instrument.
Note: Each investment option comes with its own set of features, benefits, and risks. It is crucial to carefully research and understand the terms, charges, taxation, and liquidity associated with each option before making an investment decision.
In summary, gold holds a special place in Indian society and is highly valued for its worth and symbolism. However, it’s important to remember that gold, like any investment, carries risks. Factors like global economy, geopolitical events, and government policies can impact its prices. Before investing, conduct research, diversify your portfolio, and seek professional advice.
Disclaimer: Nothing on this blog constitutes investment advice, performance data or any recommendation that any security, portfolio of securities, investment product, transaction or investment strategy is suitable for any specific person. You should not use this blog to make financial decisions. We highly recommend you seek professional advice from someone who is authorised to provide investment advice.
FAQs
Why is gold considered an asset?
Gold is an asset because it holds intrinsic value, is universally recognized, can preserve wealth, provides diversification benefits, has safe haven characteristics, and historically acts as a hedge against inflation. It is a tangible and globally tradable asset that offers stability, liquidity, and potential long-term value growth.
How does gold act as a store of value?
Gold is a reliable store of value as it maintains its worth over time. Unlike paper currencies that can be affected by inflation and devaluation, gold retains its purchasing power. It is often used as a hedge against inflation and economic uncertainty.
How is the price of gold determined in India?
The price of gold in India is influenced by international gold prices, the exchange rate between the Indian rupee and the US dollar, inflation and economic conditions, interest rates, government policies, and seasonal demand.
What factors affect the price of gold in India?
Various factors impact the price of gold in India, including international gold prices, exchange rates, inflation, economic conditions, interest rates, government policies, and seasonal demand.
What is the difference between hallmark and non-hallmark gold in India?
Hallmark gold has been tested and certified for purity by accredited assaying and hallmarking centres, assuring quality. Non-hallmark gold lacks independent verification of purity and may carry higher risks and have lower market acceptance.
Who should consider investing in gold in India?
Gold investment in India is suitable for risk-averse investors, those looking for long-term capital appreciation, individuals planning for retirement, and those seeking to diversify their investment portfolios.
