Gold Rates Gain By Rs. 350 In India On March 22: What's Driving The Market?

Gold markets in India are staying bullish at present, in line with the global trend. In the country, gold rates have surged by Rs. 350 today, on March 22. The 22 carat gold rates are quoted at Rs. 47,750/10 grams, while the 24 carat gold rates are quoted at Rs. 51,120/10 grams.

Credit Suisse thinks that new monetary order is looking out to be more prominent as a commodities crisis feeds into inflation. On the other hand, Credit Suisse investment strategist Zoltan Pozsar also feels, "When this crisis (and war) is over, the U.S. dollar should be much weaker and, on the flip side, the renminbi much stronger, backed by a basket of commodities." Investments in commodities like oil and gold are showing more profitability. Hence investors are looking out for the volatility and the trend of commodity markets. Oil and gold are being their preferences.

As a hedge against inflation gold markets is increasing consistently now. On that matter, Steve Hanke, professor of Applied Economics at Johns Hopkins University told Kitco News, "Inflation is definitely not transitory." The interest rate hike by the US Fed did not impact the gold markets largely. Rather the Russia-Ukraine geopolitical tensions are moving the markets now. One month has passed since Russia started invading Ukraine and the country is stressed both financially and politically now. The situation is not expected to improve any time soon.

A Former Federal Reserve and US Treasury Department official stated, "This crisis is not like anything we have seen since President Nixon took the US dollar off gold in 1971 - the end of the era of commodity-based money," Former Federal Reserve and U.S. Treasury Department official. In addition to that, Zoltan Pozsar mentioned, "Non-Russian commodities are more expensive due to the sanctions-driven supply shock that basically took Russian commodities' offline'. If you are a (leveraged) commodities trader, you need to borrow more from banks to buy commodities to move and sell them,"

Today, the Comex gold futures were quoted at $1928.60/oz, till last traded. The spot gold prices are quoted at $1930.0/oz, falling by 0.36%, till last traded. On the other hand, the US dollar index in the spot market stood at 98.76, gaining marginally by 0.27%. In India, the MCX gold in April future quoted at Rs. 51,421 grams, gaining by 0.04%, till last traded.