Generally, when the equity markets are underperforming, gold tends to do well, and thereby provides some protection to investors’ portfolios. The decline over the past quarter has therefore left investors bewildered and raised questions about whether they should continue to hold gold in the portfolio.
Interest rate hikes causing bearishness
As you would be aware, we in India are price takers. This essentially means that the price of gold is determined by events in the international markets. The price in India is equivalent to the price in the international market, adjusted for import duty, and the rupee’s movement against the US dollar. To understand what is happening to gold, therefore, we need to look at developments in the international market, primarily the US.
The CPI numbers have been unexpectedly high in the US. They came in at 8.6 per cent in May and 9.1 per cent in June (year-on-year). It has been more than a year since the inflation numbers have been significantly above the US Federal Reserve’s (Fed) target rate of 2 per cent. The expectation within the market, therefore, is that the US Fed will hike interest rates and also tighten liquidity at a faster pace.
This story is from the August 2022 edition of Investors India.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the August 2022 edition of Investors India.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber? Sign In
Are You Drinking Too Much Coffee? If Yes, Then You Are Taking A Big Risk!
Coffee contains caffeine in maximum percentage:
LIC MUTUAL FUND
According to World Bank data, women represent 49.7% of the world population. In India, women represent 48.4% of the population but they contribute only around 18% of the GDP compared to 41% in China.
Maintain 15-20% exposure to US funds in your equity portfolio
2022 was a difficult year for stocks in the United States (US), particularly for the large tech companies known as FANG. Concerns about the Russia-Ukraine conflict, inflation, etc led to a significant drop in their values.
Systematic Investment Plan (Sip): Meaning, Benefits, How It Works
We all dream of buying a car, dream house, gadgets, etc. This all can come to reality if we have strong financial planning. One of the best options is to start investing in mutual funds through a SIP (Systematic Investment Plan).
How to repair your credit score
Fintechs have seen their personal loan portfolios rise at a humongous pace between 2017-18 and 2022-23. However, loans below Rs. 50,000 are showing signs of strain, according to a white paper brought out by Experian and the Digital Lenders' Association of India. If you have defaulted on a loan recently, here are steps you can take to repair your credit score.
Abhaya Here For Her Smile -
Ever wondered why brushing and flossing is so important? Well, it's not just about sparkling white teeth!
The Pathway to Building Wealth: Unlocking Prosperity through Strategic Knowledge and Investment Habits
Mr. Sanjiv Bajaj is the Jt. Chairman & MD, Bajaj Capital, building the platform for the Business leaders of the Financial Services and Advisory sector to exchange their vision, experience, and views on making the right financial decisions.
India's Economic Rise and the $10 Trillion Opportunity
In the last two years, India has been the fastest-growing major economy in the world.
"Consumption is one of the most attractive investment opportunities in India"
Q 1: Your take on the recent Household Consumption Expenditure Survey? Have you observed any great change in urban or rural consumption pattern?
Learn the Magic of Self-Talk There is perpetual self-talk taking place inside all of us
We listen when our self-talk happens in our minds; we listen to whatever is imprinted in our memories and our past conditioning. Many a time we do not hear exactly what the other person is saying, and we form an opinion.
