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Rising Rupee Is Making Gold More Attractive In India - World Gold Council

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The effect of climbing gold prices is diminished by rising rupee in India, which is creating opportunities for gold buyers who are looking for a good deal, this according to World Gold Council's managing director for India, Somasundaram PR.

Rising Rupee Is Making Gold More Attractive In India — World Gold CouncilGold prices in India advanced 12% since January, while the rupee has gained almost 6% during the same period. This development has cushioned the sharp rise in gold for customers, said Somasundaram.

“This is a fantastic opportunity. It’s like Indian gold is available at a discount of 6%,” Business Standard quoted Somasundaram as saying. “People are definitely keen and the first quarter has been good.”

Plus, if the rupee continues to appreciate, as forecasts suggest, future gold discount will be even greater, he added.

Somasundaram noted that the gold market is now witnessing a recovery in India, with demand rising in anticipation of the upcoming Akshaya Tritiya festival on April 28, which is known for gold buying.

One problem, however, remains — the quantity of gold being bought. Many businesses and customers are staying away from buying large quantities of gold, according to the media report.

“Uncertainty over the goods and services tax rates for gold and restrictions on cash transactions are expected to affect the gold demand during this year, with forecasts projecting 650-750 tonnes — a subdued total for the second consecutive year,” Somasundaram said.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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