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Bhopal

Updated on: Monday, November 01, 2021, 11:06 PM IST

Ahead of Diwali, gold loses its sheen to spiraling fuel prices

Bulk investment in crude oil cast its shadow over bullion market
Women purchase jewellery in Bhopal  | FP

Women purchase jewellery in Bhopal | FP

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BHOPAL: Rising fuel prices are burning hole in the common man’s pocket, however, for those who are looking forward to investing in auspicious yellow metal ahead of Diwali, this is the opportune time.

Prices of petrol and diesel are consistently on rise leading to inflation during festival season but the bullion market is witnessing sharp decline in rates. Experts attribute it to bulk investment in crude oil. Investors are finding trading in crude oil more lucrative than gold thus they have shifted money from bullion. Gold rate is likely to go further down after Diwali as oil prices are expected to go higher.

For the third day in a row, the gold price is dipping. On Saturday, the gold prices dropped significantly by Rs 310/10 grams. On the day, 22 carat gold rate stood at Rs 46,740/10 grams and 24 carat gold rate was Rs. 47,740/10 grams. On Sunday, the gold rate continued to slump and the price of 22 carat gold was quoted Rs 46,440/10gram.

However, the fuel rates are skyrocketing, petrol has touched Rs 120 per litre, while diesel has climbed to Rs 100 per litre.

MP Petrol pump dealers Association president Ajay Singh said, “ it is generally noticed that when oil prices go up or share market zooms, it attracts bulk investment and the bullion market depletes. The increase in fuel prices leads to inflation as the price of essential commodities increase due to rise in transport cost. But the Gold price comes down. Same thing happens when share market zooms.”

Speaking on the same lines, Kalpatru Multipliers Limited MD Aditya Manya Jain said, “Prices of oil and inflation are connected. With the rise in petrol and diesel prices, inflation too goes up as transportation cost of goods increase because of higher fuel rates. Gold price has come down. The same thing happens when the share market becomes bullish because massive investment shifts to crude oil or share market.”

Sarafa Bazar (Chowk Bazar) president Harinarain Goel said, “Gold prices are controlled by the international market. As the rates are down internationally, the prices in India too have dropped. Prices of bullion coming down is good for customers, especially ahead of Diwali.”

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Published on: Monday, November 01, 2021, 11:06 PM IST
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