With gold trading at much higher side, many Indian buyers have postponed their purchases this pre-festive season. And with Diwali knocking on the doors, shops aren’t full with buyers but lots of sellers.
"Gold prices in the last two years have increased 100 per cent. It will go up in another 6 months to Rs 17,000 to Rs 20,000. I personally feel it will take consumers some weeks to realise higher gold prices are here to stay," said Mehul Choksi, Chairman & MD, Gitanjali Group.
While jewellers have seen a dip in sales of up to 35-40 per cent over last year, the bullion market is seeing 50 per cent less demand this time around. Gold has touched a record Rs 14,000 mark, a jump of 30 per cent in the past one month.
'If retail has demand and customers then bullion will sell. But if retail has no demand how will bullion sell? When their jewellery sells our bullion sells," said Suresh Hundia, president, Bombay Bullion Association.
For now, jewellers can only hope what they lose in quantity will be compensated in value by high prices despite smaller sales.
The lowered supply and demand factors are taking a toll on festival shopping sprees as of now.
However, the lure of festive season may get some last minute shoppers into the marketplace, as gold remains highly auspicious for most Indians.