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India’s Demonetisation decision likely to affect Gold Market in the short term: World Gold Council (WGC) report

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Delhi, Jan 13, 2017: India’s demonetisation decision is likely to affect gold demand in the short term, a World Gold Council (WGC) outlook report released on Friday stated.

“In India, the government’s decision to remove large denomination rupee notes took around 86 per cent of India’s circulating cash out of its economy,” according to the Outlook 2017 – Global Economic Trends and their impact on gold, released by WGC.

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“While the purpose is to replace them with newly printed notes, we believe that the liquidity squeeze could have a temporary negative effect on economic growth, and may also affect gold demand in the short term.

“But more importantly, we believe that the transition to transparency and formalisation of the economy will lead to stronger Indian growth in the longer term, thus benefiting gold,” the report added.

The WGC said there are six major trends to be watched out for in 2017 from economic perspective that would impact the gold market.

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The trends are: Heightened political and geopolitical risks; currency depreciation; rising inflation expectations; inflated stock market valuations; long-term Asian growth and opening of new markets. The report said gold is becoming more mainstream. Gold-backed exchange traded funds made gold accessible to millions of investors, primarily in the West, over the past decade, but other markets continue to expand too.”

It said, “China has seen dramatic growth in recent years through gold accumulation plans, physically settled gold contracts in the Shanghai Gold Exchange. In Japan, pension funds have increased their gold holdings over the past few years.”

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In the corporate sector, more than 200 defined-benefit pension funds have invested in gold. In addition, more than 160 defined-contribution plans have added gold to their list of investments.

“We expect this trend to continue and expand into Western markets, where pension funds have had to rethink asset allocation strategies following prolonged exposure to low (and even negative) interest rates. In our view, this will result in structurally higher demand,” the report said.

“Innovation is evident across all markets, but at the end of last year one development stood out. The Accounting and Auditing Organisation of Islamic Financial Institutions (AAOIFI), with support from the World Gold Council, launched the Shari’ah Standard for Gold, opening up the Muslim world to gold investment,” it added. (IANS)

 

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Demonetisation Anniversary: BJP acts cheeky, releases new video showing Frustration of ‘Corrupt’ Politicians following Demonetisation

The one-minute video, which is now going viral on social media, has already been re-tweeted more than 2 thousand times since it was released on November 7, on the eve of demonetization move.

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Demonetisation Anniversary
Screen grab of the sarcastic video released by BJP to mark Demonetisation Anniversary. Twitter

New Delhi, November 8, 2017 : On November 8 2016, every Indian citizen sat glued to their TV screens as Narendra Modi was set to make a big announcement. Outcome? The Indian Prime Minster shocked the entire nation with the introduction of Demonetisation, a move that was to change the very foundation of the cash-dependent Indian economy.

The much-debated move by Modi garnered the attention of several well-versed economists from the country and abroad, alike. While some people willingly welcomed the move, there were others who stood in staunch criticism.

As the move completes its first year, the Bharatiya Janata Party (BJP) is set to observe November 8 as ‘anti-black money day’ to celebrate Demonetisation anniversary in the country.

On the eve of the Demonetisation anniversary, the BJP released a cheeky video claiming to depict how ‘corrupt’ politicians have been criticizing the move, as the nation won following demonetisation.

WATCH BJP’S TONGUE-IN-CHEEK VIDEO

In the video, the BJP attempted to take a dig at corrupt politicians, who have been criticizing PM Modi’s Demonetisation move.

In the video, a woman, playing the character of a frustrated, corrupt politician can be seen going on a rant over PM Modi’s note ban initiative, which was aimed to combat black money, corruption, fake currency and terrorism.

The video ends with a voice-over saying demonetisation has not only brought out this frustration of corrupt citizens, but also black-money, claiming that almost 99 per cent cash which was previously lying hidden with people has now entered the banking system.

The one-minute video, which is now going viral on social media, has already been re-tweeted more than 2 thousand times since it was released on November 7, on the eve of demonetization move.

Ahead of the Demonetisation anniversary, the last few days have witnessed several leaders present their opinions on PM Modi’s demonetization move.

Finance Minister Arun Jaitley called PM Modi’s note ban initiative a ‘watershed moment’ while Piyush Goyal, Minister of Railways believes the move has pushed India towards a more transparent economy.

However, the move is being criticized by ex-Prime Minister Manmohan Singh calling it ‘irresponsible’. The opposition maintains that PM Modi’s note ban initiative has caused reckless damage to the country and the Indian economy.

On Demonetisation anniversary, the BJP is set to observe November 8 as ‘anti-black money day’, while opposition leaders are set to observe the day as ‘black day’ in protest against the note ban initiative.