Investment consulting firm Millwood Kane International on Tuesday mentioned that investments in gold gave gains of practically 28 per cent in rupee terms in the course of 2020 and will stay in concentrate for investors in the coming year.
“The yellow metal has had a phenomenal year with gains of nearly 28 per cent in rupee terms. After a double-digit gain in 2019, this will be the second year in a row that gold will be posting a stellar rise,” mentioned Founder and CEO Nish Bhatt.
Gold rates posted marginal gains in very first two months of the year due to issues of a slowdown in financial development. A main uptick was noticed in rates of gold from mid-March when COVID-19 hit the stage at a worldwide level.
The gains had been more in the month of August when MCX Gold hit an all-time, mentioned Bhatt.
The outbreak of pandemic and a spurt in quantity of situations led to financial uncertainties. The excess liquidity injected by worldwide central banks to enhance development led to investors flocking to gold which is thought of a protected haven.
Bhatt mentioned gold rates have shed practically 10 per cent gains from their life-higher levels as a vaccine was found which will enable include the virus and decrease worldwide uncertainties.
“As we approach 2021, gold will remain in focus for investors as central banks across the globe have pledged to keep rates low and ease liquidity to aid growth,” mentioned Bhatt.
The newest installment of stimulus package from the US government will add to the current dollar liquidity in the technique and could finish up weakening the greenback. A weak dollar could push up gold rates.
“The efficacy of the vaccine, proper implementation of the vaccination process in developing countries, low-interest rate regime, and the global central banks’ stance on liquidity will guide gold prices in 2021,” mentioned Bhatt.