Gold prices, which have been soaring recently, are now showing signs of a potential decline. In India, the price of 10 grams of 24-carat gold has reached a high of Rs 93,000.
However, experts are predicting a significant drop in the coming years, with some forecasting a 38% decrease.
If this happens, the price of gold could fall below Rs 56,000 per 10 grams. On April 4, the price of gold dropped by Rs 1,600 in just one day, raising concerns about a possible downtrend.
Will Gold Fall Below Rs 56,000?
Gold prices have been at record highs, which has benefited investors but put a strain on regular buyers.
On April 4, the price of gold fell by Rs 1,600 in a single day, leading to speculation about whether this decline will continue. Some experts believe that gold may experience a long-term price drop.
Reasons for the Possible Fall in Gold Prices
Increased Supply: Global gold production has risen, leading to a 9% increase in gold reserves, now totaling 2,16,265 tonnes.
Mining activities in Australia have ramped up, and the return of old gold to the market has further boosted supply.
Decreased Demand: While central banks bought 1,045 tonnes of gold last year, their purchases may slow down in the future.
A survey showed that 71% of central banks are either reducing their gold purchases or keeping them stable.
Market Saturation: There has been a 32% increase in mergers and acquisitions among gold mining companies in 2024, suggesting that the market may have reached its peak.
Additionally, the rise in investment in Gold-ETFs could contribute to falling prices.
Do All Experts Agree on the Fall in Gold Prices?
Not all experts are in agreement about the future of gold prices. While John Mills, a strategist at Morningstar, predicts a 38% drop, other analysts have a more optimistic outlook.
Bank of America forecasts that gold prices could reach $3,500 per ounce in the next two years, and Goldman Sachs predicts that gold may rise to $3,300 per ounce by the end of this year.
In conclusion, while some experts believe gold prices are on the verge of a significant decline, others remain hopeful for a rise.
Investors should stay informed and monitor market trends closely to make the best decisions.
