'Karat' represents the proportion of gold present in an alloy. It indicates the fineness of gold, which implies that the higher the karat, the more the purity of gold.
The price of gold in India depends on multiple factors. This includes, but is not limited to the following factors:
1) Gold production
3) Government's gold reserves
4) Demand and supply of gold in the global commodity market
5) Import rates
6) Interest rates
7) Taxes and levies
8) Local demand.
As a denizen and fellow gold loan borrower, it is imperative for you to stay updated about the latest gold rate in cityname. It is not unusual to find a little variation between the market gold price and the gold valuation offered by the lender. The difference in price primarily occurs because the lender calculates the average gold price of 22-Karat gold based on the rates from the past thirty days and extrapolates the gold gram rate. Hence, the value of the gold you get depends on the average gold price and the lender's loan to value ratio. As per the recent directive of the RBI, lenders can give loans of up to 90% of the gold's market value till March 31, 2021.
If there was another indicator to measure wealth in the world, barring currency, it would be gold. It is one of the nine noble metals, but gold’s value in the economy surpasses that of its counterparts. But the exploration and extraction of gold is a slow-moving, laborious process.
However, this metal still has a readily available market across the globe, which increases its liquidity, thereby making it an ideal asset. Owners of gold articles have the freedom to convert them into cash with ease.
Moreover, gold is a luxury good, which means that people purchase it in larger quantities when their income rises. Therefore, this yellow metal generally exhibits a steady increase due to high demand and inadequate supply, especially in a country like India. Most free-market economies of the world use gold reserves to hedge against inflation. As a result, this metal possesses an intrinsic value in the global economy as well.
The purity of the gold and the quality of the gold are two different factors that people often get confused over. Hallmark gold and KDM gold are the two types of gold that usually leads to some confusion. The two types of gold are considerably different with regards to their composition. The KDM gold has a purity level of 92%, where the gold is a mixture of 8% of cadmium and 92% of gold. Since there are some health risks associated with KDM gold, it is no longer in sale in the market. On the other hand, Hallmark gold has a certification by the Bureau of Indian Standards. The Hallmark gold is testes in assaying centers approved by the BIS. There are four varieties of hallmark gold: 23 karat, 22 karat, 21 karat and 18 karat. The purity of the gold is directly proportional to the karat rate. The higher the karat rate, the higher the purity.
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