We often used to start our investment journey with a commodity investment, and the biggest one to begin with is obviously gold. We can not only invest our money directly in gold but also trade in it through the Multi Commodity Exchange of India Limited (MCX). In this article, you’ll get to know how to analyze the gold rate today for trading purposes.
Gold Rate Today in India
22 Carat Gold Price
As on March 17th, 2023
As on March 16th, 2023
1 gram
₹5,380
₹5,355
8 grams
₹43,040
₹42,840
10 grams
₹53,800
₹53,550
100 grams
₹5,38,000
₹5,35,500
24 Carat Gold Price
As on March 17th, 2023
As on March 16th, 2023
1 gram
₹5,869
₹5,842
8 grams
₹46,952
₹46,736
10 grams
₹58,690
₹58,420
100 grams
₹5,86,900
₹5,84,200
Factors Affecting Gold Prices in India
The gold rate today in India is affected by two factors: international factors and national factors. As most of the gold is imported, the international prices directly affect the Indian price.
International factors
The price is determined by international factors, including the spot price, which is the per-ounce value of the 24 karat gold set every day on the London bullion market. After that, the import cost, transportation cost, other charges, etc. become applicable. Along with that, the customs duty is also applicable, and further, the margins are added, which adds to the total cost.
The US dollar is then converted to Indian rupees based on the prevailing exchange rate. Hence, the exchange rate has a very high effect on the gold rate today. If the US dollar rises, then gold prices will fall worldwide.
National factors
One of the best things about trading in gold is that their value will rise in the future and help in beating inflation. When the economic interest rates fall, the prices of gold strengthen. Therefore, they are very good for long-term investing.
The Indian Bullion Jewellers Association (IBJA) is the association that determines the gold rate today in India, and it is affected by inflation, demand, and supply. If the value of the rupee appreciates as compared to the US dollar, the price of gold will fall in India.
Another important factor to consider when making a commodity investment is the price of the futures. These futures are the contracts that allow the buyer to buy or sell the gold at a predetermined price, and both parties are obligated to fulfill the contract. The MCX shows the daily prices of these derivative contracts in India.
How is the gold price determined on the MCX?
The prices are not calculated directly, but the trading activity on the MCX affects them, such as the international price, exchange rate, quoted unit of gold, troy ounce to grams conversion, and supply and demand of gold in MCX trading.
The formula used for determination of the gold rate on the MCX for 1 gram of gold equals the US gold price multiplied by the exchange rate of the US $ and rupee divided by the troy ounce to gram conversion.
Conclusion
Therefore, knowing the many factors and how the gold rate today is determined on the exchange, it is very likely that it will provide long-term benefits to the investors.