Gold Prices Soar Up in the First Quarter of 2023

By Snehal Singh , 17 May, 2023

The global banking system is a crisis hit due to many geo-political problems. Gold is the only asset that has given good returns to investors more than their expectations. Due to instability in the global economy, gold prices rose, which is an all-time high till date.

The price of gold reached INR 61,490 per 10 grams on the Multi Commodity Exchange (MCX). In the first quarter of 2023, when the stock market was even more volatile due to global economic conditions, gold as a commodity gave stellar returns among all other asset classes. Even gold's charm was intact among the retail investors irrespective of its high price.

In the financial year 2022-2023, the gold price was INR 52,000 in April 2022, and the price has risen to INR 60,000 by 11 percent since the start of 2023. Conclusively,  the price increased by 15 percent in this period.

Many factors are pushing gold prices to rise - like geopolitics and war, the collapse of the banks in Europe and the US, and the monetary tightening because of the steep hikes in the interest rates in the US Federal Reserve. The tumultuous situation in the world economy has led to a rise in demand for gold with high prices in the market. As per the trends for many years, it is known that gold prices go up when the interest rate hiking cycle ends. Also, the federal reserve has hiked the interest rates virtually from 0 to 5 percent in one year from 2022 to 2023, which has already created economic stresses in the US and the rest of the world.