Why Gold Matters

ECONOMIC UNCERTAINTY ACROSS THE GLOBE HAS INCREASED THE APPEAL OF THE YELLOW METAL AMONG INVESTORS. THIS MAKES IT A GOOD STORE OF VALUE IN THE NEAR FUTURE

- P.B. JAYAKUMAR

Dharmesh Solkar, a Mumbai-based middle-level IT professional, decided to go for a week-long summer vacation to the Maldives when he got promoted in November last year. He and his wife Surabhi, a home maker, had been planning the trip for years. They had to cancel due to the Covid-19 outbreak.

Soon, he started worrying about the future when he heard about jobs cuts across sectors. In 12 years of his working life, he had saved little. The ₹2 lakh he had set aside for the trip was lying in his savings account when he got a call from a jewellery chain’s executive, who gave him gold price data from as far back as 1923 to March 31, 2020. “Since 1925, when a sovereign of eight grams was priced at ₹13.75, prices never went down till 2014,” he said. As Solkar saw prices hit historic highs of ₹54,000plus per 10 gm this year, he thought he had missed the bus. But a few days later, the relationship manager mentioned the ‘Independence Day Freedom Offer’, a discount of nearly ₹3,000 for eight grams, for purchases on August 15. Dharmesh bought a small diamond gold chain for his wife.