Tuesday, August 20, 2013

Rupee Plunges to Record Low; Gold set to turn positive in INR

Is this the real reason the Indian government has increased the import duty for gold to 10% so as Indians cannot protect themselves against a Rupee in free fall?

Aug. 20 (Bloomberg) -- Bloomberg's Diana Monteiro reports the market turmoil in India as the rupee hits a record low, with predictions of it falling further. She reports on Bloomberg Television's "On The Move Asia."  

Notice that even though gold is down 18.5% in US$ terms YTD because of the plunging Rupee (compared to USD) the INR price for gold is only down 4.7% YTD. Give it a week or two of rising gold prices and falling Rupee the gold price in INR will turn positive for the year.

chart from goldprice.org