Gold price falls by 50%, after gold market slump

The gold market is in a free fall after the Reserve Bank of India announced on Monday that the Reserve Gold and Reserve Silver price is to be reduced by 50% from the current level.

The RBI cut the price of the gold and silver coins by 50 per cent from the average of the previous week, to a price of Rs 2,721 per kg, from Rs 2.972.

The move is expected to affect gold prices in the coming months, with the metal down around 70 per cent in value from the week before.

The price of gold has lost around 15 per cent this month compared to the previous month.

The rupee fell on the announcement and the Indian rupee futures, which are traded on the ICE Exchange, lost nearly 6 per cent.

The Indian rupees gained nearly 4 per cent on the news.