Gold is a precious metal and has been an integral part of Indian culture for centuries. Whether during wedding season or religious festivals, no event is complete with the use of gold. You will find using gold as gifts in weddings, making donations to temples, and even using it to exchange for cash in times of financial requirements.
The best part about gold is that it stands solid against inflations, due to which most consumers reserve gold to meet financial contingencies. So, if you have some unwanted gold to convert into cash, now may be the right to earn some as the gold rate in Vijayawada remains at its best.
Factors that affect the gold rate in Vijayawada
The gold rate in Vijayawada keeps fluctuating due to several factors. First of all, India imports about 25% of the physical gold demand in the world. It means that any fluctuation in the international gold market leads to changes in gold jewellery prices today.
Here are the five factors that affect the gold rate in Vijayawada:
- Interest rate trends
The demand for gold also depends on the interest rates of financial products and services offered by financial institutions. The gold rate in Vijayawada is a good indicator of the interest rate trends in India. When the interest rates on financial products and services increase, people will turn to selling their gold for cash, thus increasing the supply of India. When there is a higher supply of gold, there is a lower demand for gold and a decrease in the gold price.
When the interest rates on financial products and services are low, it indicates that consumers have more cash in their hands and the ability to buy gold. In such cases, the demand for gold creases along with the gold prices.
- Jewellery market
The gold jewellery price today in the market is dependent on festive seasons. For instance, more Indians buy gold during wedding seasons and festivals like Diwali, Holi, etc. In such seasons, the demand for gold shoots up, and so does the gold rate. Selling your gold during festive seasons is the best way to earn returns on your gold investments.
Besides that, the jewellery market is also dependent on electronic manufacturing companies. They use gold to manufacture electronic items such as television, computer, smartphones, GPS, etc. So, whenever the demand for gold increases in the jewellery market, the gold prices will also increase.
Compared to currency notes, the value of gold remains quite steady, even in times of financial crises like that of the COVID-19 pandemic. Due to its steady feature, most investors tend to hold gold in the form of jewellery, ornaments, and coins rather than currency. When the rate of inflation increases, the demand for gold also increases and vice versa, and the higher the gold demand, the higher the gold jewellery prices today.
- Monsoon factor
Another factor that affects the gold rate in Vijayawada is the demand for gold in rural areas and rural India’s demand for gold increases during the monsoon. It is observed that rural India contributes to about 60% share in the annual consumption of gold, which is about 800-850 tonnes of gold. Now, that is a huge number to count. So, during a good monsoon, farmers have more cash in their hands, and they purchase more gold to increase their assets. But, during a bad monsoon, the demand for gold makes a significant decline.
- Dollar dynamics
The dollar dominates the international gold market. Whenever it shows signs of weakening, the gold prices increase everywhere. For instance, if the rate of the dollar decreases, the gold jewellery prices today in Vijayawada will increase, giving you a window of opportunity to earn some extra by selling your unwanted gold. Similarly, when the currency shows signs of strength, the gold prices decrease.
Gold is considered to be one of the safest investment options. Several gold consumers buy gold to make profits when the gold prices drop in their favor. Whether you are an investor or someone looking for a way to get access to meet an immediate financial requirement, the gold rate in Vijayawada is at its best today. It is perhaps the right opportunity to earn some extra cash by selling your gold items. However, if you wish to buy gold for investment purposes, it is advisable to wait until the gold rate drops in your favor.