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Saturday, Nov 27, 2021
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Gold

What Are You Lusting For, A Commodity?

Gone are the days when the yellow metal could hedge you against inflation or bad times

What Are You Lusting For, A Commodity?
What Are You Lusting For, A Commodity?
outlookindia.com
-0001-11-30T00:00:00+05:53

IT started on August 15, 1971. As India was celebrating its 24th Independence Day, on the other side of the globe, US president Richard Nixon was changing the rules of the global economy. Faced with a massive negative trade balance and a high unemployment rate, Nixon, sweating visibly, announced that he was taking the US dollar off the gold standard. No longer was the value of a currency dependent upon the country's gold reserves.

Within two years of Nixon's historic step, most other countries had followed suit, floating their currencies. India too. Meaning, the value of the Indian rupee was judged against a basket of currencies, and not on the tonnage of gold held by the RBI.

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