(Brief details are given below. For full detail,
view the embedded You Tube video)
Link to the video: https://youtu.be/0vUYZf9M1RQ
QUESTION
1: After
2 consecutive years of negative returns, what is your Gold Price Forecast for
2016?
Prithviraj
Kothari: I do agree that since couple of years there is a
downward trajectory with respect to Gold prices, since it had been increasing
for almost 11 odd years. But according to me a range of $1050 - $1070 an oz is
the cost to the mines to procure Gold. Looking at that figure, I find it
difficult for the price to go below this range. I see an increase to the extent
of 7% to 8% compared to last year in the year 2016.
QUESTION 2:
How will it translate in the Rupee term?
Prithviraj
Kothari: In rupee term, gold price may hover between Rs 24,000 and Rs
30,000 per 10 grams.
QUESTION
3: What impact do you envisage on gold following the US Fed’s interest rate
hike?
Prithviraj
Kothari: A 25 bps interest rate hike after a decade in 2015 followed by
four such hikes in 2016 by the US Fed has already been factored in with the
price of Gold. If you see the price of Gold eventually appreciated when the
rate hike took place. A bottom line could be $1000 to $1050 at the most in the
line with the mining costs.
QUESTION 4:
What impact do you see of high import duty on gold import into India?
Prithviraj
Kothari: Indian population is around 125 crore with consumption less than
1gram, bringing import figure to 850-900 tons. With present import duty of 10%,
it has created big gap between International price and Indian price. This
import duty almost comes to INR 250,000 per kilo. Usually, import of gold has
been in the range of 800 to 900 tons per year. Last year gold smuggling was
around 200 tons. The increased price gap may give rise to increase in gold malpractices.
QUESTION 5:
Do you see any impact of Government related Gold schemes? Would they be
beneficial?
Prithviraj
Kothari: I am positive with government efforts & schemes. Gold
Monetization and Gold Sovereign Bond schemes are good. Gold Monetization scheme
will be worthwhile, if it can draw 1000 tons or even 500 tons of gold from
temples, public etc. will also have impact on international price. It should
happen gradually.
QUESTION 6:
India’s gold import has been diverted towards Dore. Would it really help gold
jewellery industry at large?
Prithviraj
Kothari: It depends on import. Dore import is processed in limited
refineries to manufacture pure gold. These refineries import Dore at $2 lower.
Those jewelers will be benefited by $3 to 4, who make ornaments by buying gold
from refineries.
QUESTION 7:
What is your final take on ending of 2015 and 2016 soon to begin?
Prithviraj Kothari: 2016 will be good for the trade. It may create
bullion history and it may be ‘Golden Period’ for all traders.
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