Will high price take sheen off gold?
New Delhi-India (Apr 15) High and rising prices of gold has robbed city jewellers of the joy ahead of Akshaya Tritiya, considered auspicious for buying gold. At a time when sales are subdued jewellers pin hope from Akshaya Tritiya to bring back footfalls in the market.
In the year 2018, it falls on April 18. "Prices have risen so much in past few days, so we expect the business to be 10-15% lower than what is the case in normal years. If gold maintains the level, footfalls will be on the lower side," said Harshvardhan Choksi, former president of Shri Choksi Mahajan, one of the major hubs of gold market in the city. Gold of 99.5 purity was prized in the range Rs 31,850-32,150 per 10 gram in Ahmedabad market on Saturday. Gold of 99.9 purity was priced at Rs32,000-32,300 per 10 grams. It has risen over 10% since the beginning of Calender Year 2018.
Jewellers say that this is the third successive year when the festive occasion may fail to improve market sentiments.
In 2017, the sentiments were hit as the scars of demonetization were still fresh. While in 2016, jewelers were protesting against 2% excise duty on jewelry. They hope that things are better this time.
"We hope to witness footfalls as it is believed to be an auspicious day in Gujarat and other states. People buy gold even on token basis," said Choksi.
A section of jewelers feel that gold is uniquely positioned in Indian society and therefore, it will maintain its appeal whatever the situation may be. "It is said that 'Old is gold' but gold is never old. This year it gave returns of over 10% since the beginning of 2018.
This year, we may expect uncertainties in global politics and trade pushing gold to Rs34,000 per 10 gram mark close to Diwali," said Jigar Soni, vice president of Jewelers Association – Ahmedabad. He said that the current buying trend is towards diamond jewelry and light weight jewellery.
EXPERT SPEAK
Jewellers are offering discounts on labour charges as this is the only way to reduce prices. We expect that the sales are good, said Shantibhai Patel, president of Gems and Jewelry Trade Council of India.
DNAnews
