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| April 10, 2024

Stay Updated: Today's Standard Gold Rate

In India, gold has always been considered a valuable asset. Being synonymous with wealth and prosperity, this precious metal is often associated with an individual’s financial standing as well. Apart from this, gold is also among the most popular investment avenues because of the lucrative returns it offers. The simple reason behind this is the constantly increasing market price of gold.

A Closer Look at the Indian Gold Market

In the last few decades, the gold market in India has experienced notable fluctuations. If we talk about the last two decades in particular, the average ROI on gold loans has been recorded at 11.2%, which is higher than other popular investment tools. However, there have been a few lean phases as well, when there was no significant increase in the gold price.

Now it takes us to an important question: will the gold price increase or decrease in the future? Here is the answer:

The Current Scenario

Generally, the gold and equity markets have an inverse relationship. If the equity market is offering low returns, it means that gold prices will automatically increase, and vice versa. In the current situation, gold prices are experiencing an all-time high.

There is no denying the fact that the Indian gold market has been growing rapidly. However, the market prices of gold are influenced by various factors. In response to any changes in these factors, the market rate can also be volatile. Here are a few factors that explain why the gold price is increasing in the present situation:

Falling US Dollar Index 

In the global market, gold is denominated in US dollars. As a result, the relationship between Indian gold prices and the USD index is inversely proportional. When the value of the US dollar goes down as compared to the Indian currency, it pushes the gold prices in the Indian market higher.

Expected Interest Rate Cut 

Generally, gold has an inverse relationship with interest rates as well. When interest rates are low, the opportunity cost of holding gold decreases, leading to higher prices. Since the Federal Reserve is expected to announce an interest rate cut this year, gold prices may continue to rise.

An Increase in Demand from China

In recent times, gold demand in China has been on the rise, and to meet that, the Chinese central bank has been increasing its gold reserves. As a result, the global demand for gold has also increased, leading to a sharp rise in gold prices.


Effect on Gold Loans

Any fluctuations in the gold price have a major impact on several things, including gold loans. While availing a gold loan, the value a borrower can get for one gram of gold is known as the per gram rate. This rate depends on things like the purity of the ornaments you’re going to pledge. Along with that, another factor that is taken into consideration to calculate the per-gram rate of gold is the market rate of gold on that particular day.

In short, the per-gram rates for gold loans in India are decided by the market price of the metal. If the market price of gold rises, the loan amount that can be obtained against a certain quantity of gold also increases. Similarly, if the rate of gold decreases, the loan amount that one can avail also increases. 

All lending institutions check the present day’s gold rate of a certain purity before deciding the loan amount that can be availed. To roughly calculate your gold loan amount, you can do Google searches like ‘gold loan rate today’ or ‘gold rate today’. Since these market prices can slightly vary at times, it is best to search for ‘today’s standard gold rate’.

At Muthoot Finance, we offer hassle-free and quick gold loans at competitive interest rates. To get an idea of the loan amount you’re eligible for, search for Muthoot Finance gold rate today. Alternatively, you can visit your nearest Muthoot Finance branch to know more.

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