Gold Rate in Coimbatore

Gold being one of the most appreciated metals in Coimbatore is always in demand. No matter what the gold rate today in Coimbatore is, people just cannot say no to buying this yellow metal. But do you know about the factors that influence gold rate in Coimbatore? Do you know how and why these prices rise or fall?

Here are a few factors that affect the gold rate in Coimbatore

• Inflation: In comparison to currency, gold holds a significant value and can be used as a hedge against inflation. Due to this, many investors today prefer investing in gold instead of currency. When the inflation is high, the demand for gold increases since people opt out from doing risky investments. Similarly, when the inflation is normal, the demand for gold is not too much as people have other investment options open.

• Dollar and rupee equation: Gold in Coimbatore is imported from US countries. Therefore, if the value of rupee increases against the dollar, the gold prices increase and when the rupee dips against the dollar, the demand for gold decreases. Weakening dollar: Gold and dollar share an inverse relationship. A weakening dollar increases the gold rate in Coimbatore and a strong dollar decreases the gold price. This is because a falling dollar increases the demand for commodities including gold. Also, when the US dollar falls, people start looking for other investment options and gold seems to be the best option.

• Bank interest rates: If the FD rates given by banks fall, the demand for gold increases as people look to make profit as gold offers great return value.

• Time of purchase: The time of purchase of gold highly affects the gold rate in Coimbatore as the demand for gold is more during the time of festivals and weddings. Production costs: If the gold mining companies in Coimbatore increase the gold production costs, then the gold rates are highly affected.
• Import duty: Gold in Coimbatore is imported. So, with any fluctuation in the rate of import duty charged, the gold rates in Coimbatore are subject to increase or decrease.

There is an array of gold investment options in Coimbatore that one can opt to get the best returns. While gold jewellery seems to be the best gold investment option, there are a number of other options available which one can opt for.

• Gold bars: Commonly referred as gold biscuits, gold bars and coins are mainly purchased during festivals on auspicious occasions such as Dhanteras, Diwali, Akshaya Tritiya and others. Investing in gold bars ensures that you get your money’s worth as there are no making charges involved. Gold bars are also available in various weight options and one can purchase it depending on his budget and preference.

• Gold coins: Gold coins in Coimbatore are primarily purchased for the purpose of gifting or saving. They are highly liquidable and involve no making charges. Also, gold coins come in various purity options and one can purchase it from a jeweller or a bank. While buying a gold coin in Coimbatore, one should do a complete check of its weight, design and certificate.

• Gold ETF: Gold-backed exchange-traded fund i.e. the ETF is a financial instrument comprising of units backed by physical gold represented in paper or dematerialised form Gold-backed ETFs are listed and traded on the National Stock Exchange of India (NSE) and Bombay Stock Exchange Ltd. (BSE) (“the Stock Exchange”). To buy a gold-backed ETF, it is mandatory for an individual to hold a Demat or a trading account.

• Sovereign Bond Scheme: In simple terms, a Sovereign bond scheme is a government security scheme denominated in grams of gold. It is a substitute for holding physical gold. Under this scheme, an investor has to issue price in cash and the bonds will be redeemed in cash on maturity. Sovereign Gold Bonds on behalf of the Government of India by Reserve Bank of India.

• Gold jewellery: Gold jewellery purchase is one of the highly preferred investment options in Coimbatore. People usually buy gold jewellery in the form of necklaces, earrings, pendants rings and more as they help them enhance their beauty and also act as a good savings tool. However, purchasing gold jewellery involves making charges that are excluded at the time of selling.