Gold prices in the domestic market may cross Rs 30,000 per 10 grams during the June-August quarter registering a strong recovery, according to industry body Assocham.
This could result due to slowdown in inflow by foreign institutional investors (FIIs), rising headline inflation, rupee depreciation and increased demand by jewellery manufacturers and traders in the wake of wedding and festive season, the Associated Chambers of Commerce and Industry of India (Assocham) said in a statement today.
Besides, gold imports might also reach about 1,000 tonnes in 2012-13 from about 933 tonnes worth $59 billion in 2011-12 and its price might touch Rs 35,000 per 10 gram by the turn of this year, Assocham said.
“Lack of clarity on tax implications resulting in likely affect on old transactions has led to massive slump in FIIs inflows which has compelled investors to move out from capital and commodity markets and invest in bullion (both cash and ETFs) to hedge against inflation and get good returns,” said Mr D.S. Rawat, secretary general of Assocham.
“Besides, weakening rupee against the dollar due to trade imbalance together with soaring current account deficit, slowing exports on account of falling growth in the US and Euro zone and aforesaid reasons will lead to upwards spiralling of gold prices.”