Kashmir, poetically described as ‘heaven on earth,’ is known for its enchanting beauty and unique and mesmerising gold jewellery, which is famous for its well-crafted design and minute detailing Atta-hor (gold chain overhead) and Dejihor(gold earring). That is why investing in gold is one of the few things which still captivates the attention of the masses besides its beautiful scenery. Before planning to invest in gold, you need to know about gold price in Kashmir and the factors influencing it.
Gold Price in Kashmir today
Gold price today in Kashmir for 22 carats per gram is INR 4855 and for 24 karats per gram is 5098. The price for a 10-gram gold rate of 22 karats is 48550, and 24 karat gold price rate for 10 grams is 50980. This price trend may vary according to state, national and international standards.
Five Factors Influencing the gold price in Kashmir
Rates of Gold prices in Kashmir closely depend on the economic situation of our country, which in turn depends on international trends. Aside from it, various other factors may result in a rise or fall in gold rates. Here are some factors which may help you understand the fluctuation of gold prices in the market.
Value of gold price in Kashmir with Inflation
With growing inflation, the value of our Indian currency is decreasing continuously; currently, our Indian currency on its lowest INR, 82.38 against one dollar, because of which gold becomes a safe and reliable tool for the investor because, during this volatile period, it provides security, therefore leads to increase in demand and price so on.
Relationship between gold and interest rates
When banks decrease their interest rates on deposits, getting a good return on money becomes almost negligible for investors; therefore, during this time, they might prefer to invest their money in gold resulting in a higher price of gold. On another hand, when banks increase their interest rate, investors choose to sell gold hence the price drop. So, the relationship between gold and interest rates can be inverse.
- Demand And Supply
The third and most easy to understand but crucial factor affecting the gold price in Kashmir is its increasing demand among people. According to the historian, people have been mining this precious yellow metal for 5000 years, meaning gold has been a safe investment since ancient times. Still, in reality, gold is a non-consumable finite resource, which means, unlike petrol, the gold which has been mined from the earth is still in the market commodities, making it attractive in long run investment hence increase in demand. Still, in the face of ever-growing demand, its production remains at 2000 to 3000 tons annually, which makes gold one of the rarest metals. For this reason, gold prices should remain steadily upward.
- Government reserves
The Indian government holds our country’s most gold, nearly 745 tons, for controlling trade war, cash flow, and inflation. When the government started its drives to purchase gold, prices went up. This is because the supply of Indian currency increases, and the availability of gold becomes more scarce.
What should you buy as a gold investment?
There are many options available for you as a gold investment. You probably have already invested in gold in the form of jewellery. If you are thinking of investing in physical gold, you need to know what type of gold you need.
There are three significant types of gold differentiated based on their purity. Most pure is 24 kt, almost 99.9 % of gold. Another is 22 kt which contains 91% gold. And lastly, 18 kt contains 75 % of gold.
If you are not interested in buying jewellery, you can also buy gold in the form of coins, bars, or bullion. Coins come in weights from 1 to 20 grams of gold. Similarly, gold bars also come in 1gm,5gm, and 10gm gold rate for a bar to 20 grams of gold bar.
You can also purchase stock in a gold mining company or share a Gold Exchange Traded Fund (ETF) that monitors gold prices and other commodities.
People’s most preferred choice in gold investment remains between gold bars and coins.
Which one is a better investment, a 10gm gold rate of coin or a 10gm gold rate of a bar
If you are confused between coin and bar, buying a small bar of 10 gram gold rate is INR 50980 of 24 kt. A 10gm gold rate of 22 kt is INR48550 is the best choice than buying a gold bar in kilograms because a large gold bar reduces flexibility when the gold rate drops. In contrast, coins provide a variety of options in terms of investment value. It can be used as collectable and high liquidity, i.e. as coins are universally recognized, they are easy to sell. For instance, the 10gm gold rate coin is available everywhere but not 10-gram of the bara.
Conclusion
During the covid crisis, the virus has forced many stock markets onto their knees across the globe. As one of the most uncertain and volatile periods of investment, which we have not seen in history, many people have lost their wealth and even jobs, but there are some exceptions in assets, and one of these assets is gold which is not only retained but also increases people’s wealth. A tested example proves its excellent value in investment and extremely safe option to spend your money. So, get ready to buy your share of gold this year.
