Chennai: With the decline in interest rates and increase in gold prices, global investors now seem to prefer gold instead of the US dollar for hedging, India is sitting on a huge gold mine.

Speaking at The India Finance Forum (TIFF) on the trends in economy, currency and oil prices, S Naganath, chief investment officer, DSP Merrill Lynch Managers Limited said, "Indians have been a buyer of gold for decades. With gold prices going up, it is time to monetise the metal. It is estimated the value of household gold in India is around $250 billion."

He also raised doubts about the sustainability of the US dollar as the global reserve currency. "I will not rule out gold a standard coming back."

Referring to China he said, "Chinese manufacturers will put pressure on other manufacturers, which augurs well for consumers." But China will face problems when the commodity supplies increases and newer technology advancements happen.

On oil he remarked, Russia will see more investments in oil exploration. "Russia is one of the largest oil suppliers and the Siberian region is under-tapped."

Wondering whether Japan, with its ageing population, could become the financier for Asian economies Naganath said, "India should engage with Japan and Russia for fund and oil."