The price of gold in the international markets at the end of 2014 were around the US 1200 per ounce level – nearly the same point at which they stood 12 months earlier. The year saw less volatility in the prices of the yellow metal which reached a high of US$ 1380 in March and a low of US$ 1140 in November.

The weakening of oil prices and the strengthening of the US dollar driven by an improved economic scenario in the US, were the main factors behind this relative stability.

Last year’s basic changes in US monetary policy have also weakened the attractiveness of gold for retail investors, who have consequently reduced their exposure. Overall investents in gold exchange-traded funds have fallen in the past 12 months.

WGC too has reported weakening of demand in the June-September 2014 quarter when jewellery demand was down 4% and demand for bars and coins fell by a much larger 21%. However, the withdrawal of the 80:20 rule governing gold export-import in India and early indications of improvement in demand during the US holiday season, may see some changes in the scenario in the last quarter of 2014.

Analysts are now describing the current gold price levels as a ‘break-even’ price for miners to retain their profitablity and believe that there will be no significant long-term changes in the prices of the yellow metal for the next three years or so.