A few people have asked me…’should I increase my SIP in gold’.
Frankly for me the answer is ‘I do not know’.
However I realise that many of them are sitting on small losses or a very poor return if they have invested in the last 10-12 months.
The Rupee not long ago was 40 is now at 60. That is not good news for FRESH imports of gold, the currency has already acted like an import duty.
Then there is import duty and the cost of getting it to the shop.
Take the other side of what is happening in the Indian economy. Big job losses like the Insurance sector, Retail, banking, is not a great scenario. All this does not augur well for the Indian consumption to go up. And please do remember India is growing slower than 6.5% rate…All this is likely to put pressure on the gold prices – DOWNWARD.
Gold will go up at a rate slightly higher than inflation. International scenario is different, but if India and China are not net importers -that too in a big way, gold can come down…
So I may not say sell, but I will surely not say buy.
Please remember in business / metal cycles SIP will not work. Not work at all. God bless you.
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