Gold-Silver Price: Gold Plummets by ₹10,643 in 21 Days, Silver Drops ₹30,090; Festive Demand Wanes

Gold and silver prices have witnessed a significant downturn recently, with gold becoming ₹10,643 cheaper in just 21 days, now trading at ₹1,20,231 per 10 grams. Similarly, silver has seen a substantial drop of ₹30,090 in 24 days, bringing its price down to ₹1,48,010 per kilogram. This sharp decline is primarily driven by a reduction in festive demand, a decrease in global tensions, and widespread profit-taking by investors.

Sharp Decline in Gold Prices

Gold prices have experienced a notable fall of ₹10,643 over the past 21 days. On October 17, gold had reached an all-time high of ₹1,30,874 per 10 grams, but it has now settled at ₹1,20,231 per 10 grams. According to the India Bullion and Jewelers Association (IBJA), gold prices fell by ₹439 on November 7, following a price of ₹1,20,670 per 10 grams on the preceding Thursday, while this correction in prices might present an opportune moment for potential buyers who were deterred by the previous record highs.

Significant Drop in Silver Rates

Mirroring the trend in gold, silver prices have also seen a substantial reduction. Over 24 days, silver has become ₹30,090 cheaper, now trading at ₹1,48,010 per kilogram, while on October 14, silver had touched its highest-ever mark at ₹1,78,100 per kilogram. Today, silver prices dropped by ₹232, compared to yesterday's price of ₹1,48,242 per kilogram. This decline in silver is also a reflection of global market sentiments and a dip in domestic demand.

Understanding IBJA Rates and Their Significance

The prices released by the India Bullion and Jewelers Association (IBJA) don't include 3% GST, making charges, or the jeweler's margin. This is why the retail gold prices in various cities differ from the rates announced by IBJA. These IBJA rates are crucial as they're used by the Reserve Bank of India (RBI) to determine the rates for Sovereign Gold Bonds (SGBs), while Plus, several banks take advantage of these rates to set their interest rates for gold loans, underscoring their importance in the financial sector. The price of gold varies Importantly based on its purity, measured in carats. 24-carat gold, considered the purest form, is priced at ₹1,20,231 per 10 grams, while 22-carat gold, commonly used for making jewelry, is priced at ₹1,10,132 per 10 grams. For 18-carat gold, the price is ₹90,173 per 10 grams, and 14-carat gold is available at ₹70,335 per 10 grams, while consumers should choose the appropriate carat based on their specific needs and budget.

Gold Prices in Major Indian Cities

Gold prices for 24-carat gold show slight variations across major Indian cities. In Delhi, 10 grams of 24-carat gold is priced at ₹1,22,170, while in Mumbai and Kolkata, it stands at ₹1,22,020. Chennai records slightly higher prices at ₹1,22,950. Jaipur and Lucknow have prices at ₹1,22,170, Bhopal, Patna, and Ahmedabad at ₹1,22,070, and Raipur at ₹1,22,020 per 10 grams. These differences are influenced by various local factors, which will be elaborated upon further.

Key Factors Behind the Gold and Silver Price Drop

Several key factors contribute to the recent fall in gold and silver prices, while firstly, the conclusion of seasonal buying in India. Following major festivals like Diwali, the intense period of gold and silver purchases has subsided, leading to a decrease in demand. Secondly, easing global tensions. Gold and silver are often considered 'safe-haven' assets, meaning people invest in them during times of uncertainty, while with global tensions de-escalating, the demand for such safe investments has diminished. Thirdly, profit-taking and 'overbought' signals, while after a significant rally, investors are now booking profits. Technical indicators like the Relative Strength Index (RSI) had shown that prices. Were in an 'overbought' zone, prompting trend followers and dealers to initiate selling.

Year-to-Date Surge in Precious Metals

Despite the recent decline, gold and silver have shown a remarkable increase in value over the year. So far this year, gold prices have surged by ₹44,069. On December 31, 2024, 10 grams of 24-carat gold was priced at ₹76,162, which has now risen to ₹1,20,231. Similarly, silver prices have increased by ₹61,993 during the same period. On December 31, 2024, one kilogram of silver was priced at ₹86,017, now reaching ₹1,48,010 per kilogram, while this indicates that, in the long term, investing in precious metals has proven to be profitable.

Essential Tips for Buying Gold

When purchasing gold, it's crucial to keep a couple of points in mind. Firstly, always buy certified gold with a Bureau of Indian Standards (BIS) hallmark. This hallmark includes an alphanumeric number, such as AZ4524, which indicates the purity and caratage of the gold. Secondly, before making a purchase, cross-check the correct weight of the gold and its price on that particular day from multiple reliable sources, such as the India Bullion and Jewelers Association website, while also, remember that prices vary for 24-carat, 22-carat, and 18-carat gold.

Reasons for Varying Gold Prices Across Cities

There are several reasons why gold prices differ across various cities in the country. Firstly, transportation costs. Gold is a physical commodity, and its import and distribution to inland areas incur transportation expenses, including fuel, security, vehicle, and staff costs. Secondly, the quantity of gold purchased, while south India accounts for approximately 40% of India's total gold consumption, where sellers buy gold in bulk, potentially leading to lower prices. In contrast, demand in Tier-2 cities might be lower, resulting in higher prices. Thirdly, local jewelry associations, while for instance, in Tamil Nadu, gold rates are determined by the Jewelers and Diamond Traders Association, and similar associations exist across the country that set local prices. The fourth and most significant factor is the jeweler's purchase price. Jewelers who acquired their stock at a lower price might. Charge customers less, contributing to the city-wise variations in gold rates.