After this big appeal of PM Modi, the gold market suddenly changed, customers started lottery amid record breaking fall.

Gold prices have been continuously fluctuating for quite some time now. Gold had reached its highest peak in the month of January this year, but since then it has seen a big decline.

Today i.e. on Monday also a decline was recorded in the price of gold and it fell further. This fall has raised many questions in the minds of those who are thinking of making a big investment in gold.

According to the latest data released by the World Gold Council (WGC), while gold prices have declined globally in the month of May this year, on the contrary, a huge rise has been seen in the Indian market. However, the history of gold prices shows that whenever there is a huge rise in gold prices, immediately after that a big fall also hits the market. In such a situation, the biggest question is whether gold is going to become much cheaper in the Indian market in the coming time? Well, let us tell you that so far this year, gold has given very good returns to the investors in the Indian domestic market.

What is the difference between the world and Indian markets?

According to a recent special report of the World Gold Council, titled ‘Gold Market Commentary: Hiking up a Volcano’, a decline of 1.4 percent was recorded in the global gold price in the month of May. In contrast, gold prices in India saw a strong rise of 4.1 percent during the same period.

It has been reported in the report that at the end of May, gold closed at the level of $ 4,546 per ounce in the international market. If we talk about the Indian domestic market, so far this year gold has earned bumper returns of about 20 percent to its investors, due to which the faces of the investors are happy.

Why did gold prices increase in India?

Now this question must be arising in your mind that when gold was becoming cheaper all over the world, then why were its prices increasing in India? In fact, the main reason for this rise in gold prices in India is the increasing geopolitical tension in West Asia (Middle East) and huge turmoil in the bullion markets.

Meanwhile, while recently addressing the nation, Prime Minister Narendra Modi had also made a special appeal to the citizens of the country. PM Modi had asked people to postpone the purchase of gold for some time. Due to this appeal of the Prime Minister and the effect of high prices already present in the market, there was a slight softening in the demand for gold in physical markets like India, South Korea and Japan and some discounts were also given.

After this appeal, the government had increased the import duty on gold to reduce the pressure on the country’s balance of payments and to stop indiscriminate import of gold. This decision of the government had a direct impact on the prices of gold and its prices increased in the domestic market.

What does the old history of gold prices say?

If we look at the price history of the last two decades, i.e. 20 years, we see a very clear pattern. History indicates that whenever there is a big and record-breaking rise in gold, it is followed by a big fall in the market. The record-breaking rally of gold, which started from September 2022, reached its historical highest level i.e. $ 5,594.82 an ounce on January 29 this year. During this entire period, gold gave a whopping return of about 245 percent to the investors.

However, since touching this historic peak, gold prices have been in a downward trend. In the international market, gold was trading at $ 4,368 an ounce on Monday morning, falling by about 22 percent from its all-time high. If we understand the old trends and patterns of history, then there may be an even bigger fall in the prices of gold in the coming months or years. Market experts believe that only after this big fall, gold will once again return to the growth path.