Gold Prices Plunge 17% as Global Market Shifts Impact Local Trade

The price of gold in Mauritius has plummeted by 17% since mid-February, marking a significant correction in the precious metals market.

Local importers report that while the downward trend has been developing for weeks, the momentum has accelerated sharply, with prices dropping between 5% and 6% in the last 48 hours alone.

Global Factors and the Strengthening Dollar

According to analysis by Forbes, the slump is being driven by a complex interplay of geopolitical tensions and energy costs.

Rising energy prices have fuelled inflation fears, prompting central banks to maintain high interest rates.

Consequently, the US Dollar has strengthened, placing downward pressure on gold.

Furthermore, investors are increasingly pivoting away from precious metals to favor oil, which has emerged as a key strategic asset in the current climate.

Local Market Response

Despite the international volatility, the Mauritian market operates under a distinct mechanical structure.

“Internationally, prices remain volatile and are gradually stabilising,” a local importer explained. “Here, we operate with a daily fixed price. Adjustments are made in stages, but they are very real.”

While the local market is less reactive in real-time than global exchanges, it eventually reflects international trends with a slight time lag.

Outlook for the Jewellery Sector

The price drop is expected to provide a much-needed boost to the jewellery industry, which has been stifled by high costs in recent months.

However, analysts remain cautious regarding the longevity of this trend. Given the ongoing uncertainty of the international situation, gold could rapidly regain its status as a “safe haven” asset, potentially reversing recent losses.

Source: l’Express