Edit this postBank of Cyprus is trying to wriggle out of the situation where it has been cornered and in its efforts to get out of the situation it is trying to sell its gold deposits.
This trend can be followed by other debt ridden countries and thus downward spiral of gold may continue in the short term. We have already stated that one can go long in gold only when it starts crossing above $1527 level per ounce.
Thus for the shorter term time frame one should avoid gold companies and gold loaning companies as their margins will be under pressure in first quarter of 2013. The stocks to include are Titan, TBZ, Gitanjali gems, PC Jeweller, Shree Ganesh Jewellery House, Muthout finance and Manapuram
Verdict
This fall in gold price will enable people to unlock their hidden money from gold and this money will get used in a productive business to give boost to economy and create job opportunities and thus we can call gold fall as a blessing in disguise. Have a look at below screen shot which shows the impact of gold imports on current account balance and information is authentic as it has been sourced through RBI.
