Gold prices edged lower on Monday in Chennai as the global bullion market weakened amid a stronger US dollar and cautious investor sentiment. The city, known for its strong demand for gold during festive and wedding seasons, saw a minor dip in retail rates even as global trends continue to influence domestic prices.
India, the world’s second-largest consumer of gold after China, remains heavily dependent on imports to satisfy its massive appetite for the yellow metal. Recycled gold contributes only a small portion to the overall supply, keeping the country reliant on international markets for bullion inflows.
Rupee Movement and Global Trends Shape Domestic Prices
Since gold is traded globally in US dollars, fluctuations in the rupee-dollar exchange rate directly affect its price for Indian consumers. A depreciation in the rupee makes imported gold costlier, which in turn pushes up retail prices. Conversely, a firmer rupee helps limit price rises.
Globally, gold rates are influenced by several macroeconomic factors, including changes in bond yields, monetary policy decisions by central banks, and shifts in investor risk appetite. Despite short-term fluctuations, the precious metal continues to be regarded as a safe-haven asset, offering stability amid market volatility and geopolitical tensions.
Local Gold Rates in Chennai
As of Monday, the gold price in Chennai stood at Rs 12,491 per gram for 24-karat gold (999 purity) and Rs 11,450 per gram for 22-karat gold. The decline reflects subdued demand amid global cues suggesting limited upside in bullion in the near term.
Meanwhile, similar patterns were observed across other major Indian cities. In Delhi, 24-karat gold was priced at Rs 12,463 per gram, while in Mumbai, it traded at Rs 12,448 per gram.
Gold Retains Its Allure Despite Short-Term Pressure
At a time of global economic uncertainty and shifting monetary trends, gold remains a preferred choice for Indian investors seeking long-term financial security. Analysts note that while prices may witness minor corrections, structural demand for the metal is likely to stay robust, driven by cultural significance and its role as a hedge against inflation.
