Abstract
The most precious metals is Gold for long and its value has been used as the standard for many currencies also known as gold standard. The consumption of gold has increased drastically with strong economic growth and promising movements in gold prices in 1990s during liberalization of gold import policy. The gold prices in India are continuously increasing due to domestic demand based on security, liquidity and diversified portfolio. There would be various factors that influence the prices of the gold. This study aims at understanding and analyzing the various factors which influence the gold prices in the Indian context.
Highlights
The most precious metals is Gold for long and its value has been used as the standard for many currencies known as gold standard
The relationship among gold prices, Bombay Stock Exchange’s Sensex, National Stock Exchange’s Standard and Poor’s (S & P) Financial Services LLC CNX NIFTY (S & P CNX NIFTY) and United State (US) dollar/Indian rupee (USD/INR) exchange rate for the period January 1998-April 2014 was studied by Atul Shiva and Monica Sethi [18] and the results revealed that that gold prices, SENSEX, USD/INR and S & P CNX NIFTY are in equilibrium in the short run and long run
The results revealed that returns of Sensex index does not lead to increase in gold price and rise in gold price does not lead to increase in Sensex
Summary
The most precious metals is Gold for long and its value has been used as the standard for many currencies known as gold standard. It has been used as a symbol of purity, value, royalty and pool of these properties. Due to its importance in both investment and consumer world, Gold is one of the most widely debated metal and continues to have strong impact on the value of currency of developed countries. There exists a strong correlation between the value of the gold and the strength of currencies trading on foreign exchanges
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