Many buyers for gold, experts caution
Posted on: 20/Apr/2013 3:34:42 PM
There has been wave of purchase of physical gold in the wake of falling prices of the yellow metal globally. Says an official at the World Gold Council (WGC), ‘ There is a shortage for bars and coins in Dubai, a key market for the metal. Despite the gloomy projections, premiums are at $26 per ounce in Mumbai and $6 in Shanghai for gold. This indicates that buyers are willing to pay more than the spot prices for the metal.’
However, experts have cautioned buyers about the volatile nature of the metal’s trading. ‘There has been excessive speculation in gold. Investors should avoid lump-sum purchases (of gold)… Investors should not go overboard as further (downward) correction cannot be ruled out. The risk of a larger fall is still there. If it (downtrend) lasts for more than six months, the bear phase in gold could well turn out to be a long drawn affair’, they say.
