India: Current upward movement in Gold prices has been due to, weakening of the US dollar, upcoming festive seasons, concerns on inflation due to low rates by the government. As gold has very less relationship to other asset classes, people consider it as a relatively less riskier investment (safe haven). Those of you who are thinking of borrowing money to invest in gold, think again as the interest rates in India are higher than the risk involved.

Our View: Do not invest in gold for short term trading purpose because the background news/information (like the weakening of the US dollar due to news from Gulf, etc) could change direction rapidly, leading to loss. Though you can invest in gold as long term investment and usability perspective, and for that you can actually wait for “off-season” when the festivals are over. Why pay premium on a long term investment when you can potentially get it cheaper after 2-3 months when the festival season is over?

Link: http://economictimes.indiatimes.com/articleshow/5096908.cms