Gold rush before Dhanteras: Jewellers

October 23rd, 2011 - 3:05 pm ICT by IANS  

Kolkata, Oct 23 (IANS) The gold rush across India just before Monday’s Dhanteras festival has made jewellers confident of increasing their business, though prices of the yellow metal show volatility and hover high.

Dhanteras is considered a day auspicious to buy gold.

Gold bullion and coins are in high demand along with jewellery as more and more people now turn to the precious metal as a safe investment option at a time the country’s stock markets seem unstable amid the global economic uncertainty, jewellers said.

“Gold jewellery business has picked up now with the international prices declining by about $300 per ounce in two months. Buyers are coming back to the market following some stability in the system for a few days,” Tanishq Vice President (Retail) Sandeep Kulhali told IANS over phone from Hyderabad.

“We hope that business will be at its peak this weekend just before Dhanteras. The market will bounce back,” he added

Since the Navratri festival, the gold business has been doing very well, he added.

Gaja Jewellery, one of India’s largest manufacturers and exporters of handcrafted jewellery, seconded Kulhali.

“Demand for gold coins has gone up by 50 percent compared to last year, as people have started realizing that investing in 24 carat gold is profitable as it is very liquidable (asset). There have been advance booking orders for gold coins,” Gaja Jewellery Marketing Head Rahul Singh said.

The fall in gold prices in international markets from about $1,900 an ounce in September to about $1,600 an ounce in October has also boosted the buying spree.

“Gold business in the first quarter (April-June) was phenomenal. In August and September demand was negative compared to the same period last year as there were no weddings in September,” Kulhali stated.

“In September there was also a huge volatility in the global gold prices. So people were holding back their purchase,” Khulhali said.

Bullion and coins of the yellow metal and also gold exchange traded funds are in high demand as people feel investment in the precious metal is safe in the long-term, Khulhali noted.

General public is not affected by high gold prices, and there will be maximum number of footfalls in jewellery shops across the country Oct 24, Jaysukh Parekh of Ramesh Chandra Parekh Jewellers said.

“Dhanteras is auspicious time for capital investment,” he asserted.

“Big ticket small time investors are now investing in gold as the prices of the precious metal shows an overall upward trend and a positive outlook amid the current economic uncertainty,” Regional Chairman of the Gem and Jewellery Export Promotion Council Pankaj Parekh, told IANS.

Dipankar Dasgupta, former professor of economics at the Indian Statistical Institute, echoed Parekh.

“As the general public in the country cannot invest in foreign currencies, it is expected that they will invest in gold as currently there is volatility in the stock markets,” he said.

While earlier Dhanteras was celebrated only in northern and southern India, now the festival is celebrated across the country, Rahul Singh said.

(Mithun Dasgupta can be contacted at mithun.d@ians.in)

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