By
Bloomberg
Published
March 10, 2025
The world's largest jewelry market is promoting its gold bets.
With the configuration of precious successive metals this year, jewelers and retail merchants in India are resorting to gold futures options for both speculation and to cover physical holdings. According to Sugandha Sachdeva, founder of the research firm SS Wealthstreet, the cheapest bets that the future have gained a new attraction with the recent increase in bullion.
The increase in the interest of investors has become evident in the multiple exchange of basic products of India Ltd., the main product base of India: the average daily turnover of the options in gold futures increased to 605 billion rupees ($ 7 billion) in February, representing 26% of the total volume of options in the exchange: the highest proportion since October 2021. Options in teaching contracts Actions, but their participation in 52% of the proportions of the proportion of more than 2021. year.
The concerns about the tariff policy of the president of the United States Trump sent oil to a minimum of six months last week, pushing investors to assets considered safer, such as Linghes, more than 7% since its inauguration in January. While the options trade will continue to evolve, market actors are generally optimistic with gold, said Gnanasekar Thiagarajan, director of the Basic Products Research firm Commrendz Research.
“Trump uses the shock value, 20% -30% of the rate, and then negotiates. All this uncertainty is of bullish gold, ”he said.
The precious metal occupies a venerated position in India, where it is seen not only as a reserve of value and symbol of wealth, but also as a sacred asset imbued with an auspicious meaning. The gold jewels, which fell into almost all countries last year, fell only 2% for India after a July cut in import tariffs stimulated the demand, which allowed the nation to recover its place as the largest jewelry market.
As the metal reached record levels in February, the option of options in its future for the month was almost triple the average of 2024, as shown by the MCX data. Meanwhile, the average daily billing of the options in oil futures fell to 1.2 billion rupees, less since June.
In the USA, the gold options almost doubled last month from February 2024, according to CME Group Inc.
“The merchants moved away from crude oil options, as they found better opportunities in gold,” said Rahul Kalantri, vice president of basic products in Mehta Equities Ltd.
It remains to be seen if the trend will continue: the billing of the options in oil futures recovered last week and fell in love with gold. But with the current concerns that surround the rhythm of economic growth in India and the securities market trajectory, Bullion will continue to be a favorite among investors, according to ThiaGarajan.
“Interest in gold and oil is generally inverse,” he said. “What is good for the economy is good for oil. And when it is not good for the economy or there is uncertainty, people rush into gold. “
