The gold prices in India are predictable to rise continuously. ICICI bank is apparently pricing the gold at around Rs. 9000 per 10 grams. Resident Indians and the NRI both are maintaining an eager interest in the gold because of the social reasons. But if this predictable price rise is seen as the reason to rush in and buy the gold for the investment then the investors will require stopping and then thinking for a moment than an expected prices rise in India is equal to 10.5% per annum growth rate. Indian bank deposits can give you more than 9% per annum and hence 10.5 % return on the asset class where a price fluctuates seems to be moderate.
There is the perception that gold can act as long term natural evade against the inflation. The information from US doesn't necessarily sustain this assumption. If the gold price was to have kept swiftness with the US inflation since January 1980 then the current price would have been at least US$ 2100 per ounce. The Indian investors should be aware also that while the gold price in dollars can strengthen, weakening dollar can mean the slow rise in the gold prices in the rupees terms.
Prices in india