Gold price slides to eight-month low


Gold was traded at Rs 49,500 per tola on Friday, with a sharp fall of Rs 700 a tola in a single day, slumping the price of the yellow metal to the lowest level in eight months. The fall is in line with a global downtrend in the bullion market on the news of the US Federal Reserve’s interest rate hike this year.

The last time gold was priced at the current level was on November 11, last year, when it was traded at Rs 49,500 per tola.

Gold is gradually losing lustre in the international market due to a stronger dollar, with an easing in jobless claims reinforcing market expectations of a 2015 US interest rate hike, according to Reuters.

Even as gold price is fixed in the domestic market based on the international market rates, the import of gold has declined since the last fiscal due to subdued demand from jewellers. Mostly gold is being consumed in the form of jewellery in the country.

Import bill of gold dropped heavily by 66.3 per cent in the first 11 months of fiscal 2014-15 to Rs 8.07 billion, according to data from the Trade and Export Promotion Centre.

Silver, which had also plunged by Rs 10 per tola in a single day to be traded at Rs 670 per tola on Thursday, recovered some of the loss on Friday. The price of the white metal increased by five rupees a tola on Friday and was traded at Rs 675 per tola.