A rising Indian Rupee has sent gold prices in India on a free fall over the week. Gold rates on Saturday extended their decline to 4 days consecutive. The prices are attributed to a strong display by the Indian currency, as traders eagerly watch the forex market for more updates.

The prices for gold in India have now reached Rs 31,460 after this meek free fall. Silver prices also tracked the trend set by gold to fall over the week. The prices of silver on Saturday tumbled by a hefty Rs 515 to reach levels of Rs 36,560 per kg. The fall is said to be in line with a weak demand from coin makers and industrial units.

Prices of gold with 99.9 percent and 99.5 percent purity have now reached Rs 31,460 and Rs 31,310 respectively, for each 10 gram.

5 Things to Know About This Fall

The current decline in gold prices has seriously sent alarm bells ringing across the country, and traders want to know as much as they can about it. Here we discuss the 5 things we know about the fall in gold rates during the week ending 2nd December 2018.

1.It is believed that the sharp decline in the rates for gold is influenced by a growing rupee. An increase in the rupee reduces the cost of imported gold, which makes the metal cheaper. The rupee has had a good couple of months, and finished trading in November with a four-month high of 69.5 against the US dollar. The recent upward curve for the Rs has meant that gold is now coming in cheaper than it did before.

2.The fall in gold prices might just help influence the demand for festive gold buying in India. “The appreciating (Indian) rupee has brought down prices. At this price level, jewelers and retail buyers are quite comfortable in making purchases,” mentioned a wholesaler in Mumbai. This decrease might just help retailers replenish inventories.

3.The prices of silver have tracked the path set by gold, and have decreased by some 900 Rs during the last 4 sessions of trading. The rates for silver are now valued at Rs 36,560 per kg. However, silver flats have remained flat at Rs 73,000 for selling and 72,000 for buying.

4.If the growth in the Indian rupee and the falling cost of importing gold within the country wasn’t enough, gold prices in India are also being influenced by decreasing global rates. Gold prices are decreasing in the gold market, as the metal traded between $1,210 and $1,230.07 for the last couple of weeks. The global prices are believed to be impacted by a rebound within the stock markets, and an increase in the performance of gold.

5. However, despite global prices keeping low currently, gold in the foreign market is believed to go on a rally next year. The assumptions come in line with the expectations that the American Federal Reserve would be monitoring interest rate hikes, in a bid to slow them down.