Gold rate in Dehradun

Nestled in the scenic Doon valley, Dehradun is the capital of Uttarakhand. It is also a popular education hub. It serves as a gateway to popular hill stations like Nainital and Mussourie. The business heartland of Uttarakhand, Dehradun, attracts people from all corners of the state.

As in most cities of India, the people of Dehradun buy gold to celebrate festive occasions. They also see it as a holistic approach to wealth creation. Various factors impact gold rates in the city. So, before you make a purchase decision, here's everything you need to know about gold rates in the city.

Factors Affecting Gold Prices in Dehradun

Demand and Supply

The demand and supply of gold can influence its price in Dehradun. Like most products, a high demand but low supply increases the rates and vice versa. For instance, during festivals, the demand for gold is especially high. This leads to a surge in the price of gold in Dehradun.

Value of the US Dollar

Gold and the US Dollar (USD) are inversely related. Since gold and bullion trade is carried out in USD, the dollar's value impacts gold rates. When the value of the US dollar falls, gold prices rise, and when the dollar strengthens, the gold rates drop.

Government Regulations

Government regulations on taxes and duties impact gold rates. For instance, the implementation of GST (3%) has increased tax rates for gold. In addition, the tax charged by the local government also influences gold rates in Dehradun.

Inflation

The change in gold price is usually directly proportional to inflation; that is, higher levels of inflation cause gold prices to rise due to falling currency values. Since gold's value remains stable over time, people usually prefer to keep their wealth in gold during inflation, which increases its demand. As a result, gold is also considered a hedging tool against inflation.

Government Reserves

The RBI holds gold reserves, and the gold price increases when it holds more gold than it sells. This results from the market experiencing an increase in cash flow and a shortage of gold.

Gold Investment Options in Dehradun

Traditionally, gold was purchased in the form of jewellery, bars, and coins. In recent times, newer avenues have also emerged. So, here's a look at various ways to invest in gold in Dehradun:

Gold Jewellery

Buying gold jewellery during religious festivals and weddings is the most common way to invest in gold in India. However, there are some flipsides to purchasing jewellery. For instance, hefty making charges may weigh heavily on your wallet. In addition, due to constant changes in fashion trends, the design of a jewellery piece might get outdated in a few years.

Hence, jewellery is an excellent investment option when bought for immediate use. But there are several other forms of gold investments that are worth considering.

Gold Bars and Coins

You can purchase gold bars or coins from jewellers, banks, Non-banking Financial Companies (NBFCs) and e-commerce platforms. These coins come in various finishing, designs and sizes. Moreover, the making charges are significantly lower than for gold jewellery.

Gold Exchange Traded Funds (ETFs)

Gold ETFs are mutual funds that invest in gold bullion. Each unit here represents physical gold in dematerialised form. One ETF unit is equal to one gram of gold. Moreover, these passive investments are traded on stock exchanges. Hence, to invest, you must have a Demat account. An ETF presents the dual advantage of gold investments and exposure to stock markets.

Here are two reasons why ETFs are getting popular:

Since you can purchase and sell ETFs in cash, there is complete transparency.

ETFs are held in electronic form in Demat accounts and thus do not demand added storage.

Gold Mutual Funds

A gold mutual fund is another popular way to invest in gold in Dehradun. These funds invest in companies that deal in gold in some form. Managed by professional fund managers, the underlying asset of a gold mutual fund is physical gold. Hence, fluctuations in gold prices in the market impact the Net Asset Value or NAV of the funds.