Imports rise 429% YoY in Aug ahead of ‘gold’ season
Tue Sep 03 2024
Anticipating higher festive demand, gold procurements in Aug have increased by a whopping 429%, as compared to the same period last year. According to the latest import numbers issued by the Ahmedabad Air Cargo Complex (AACC), some 23.7 MT of gold was imported into Gujarat in Aug alone, which is about 4.2 times higher compared to the 4.48 MT imported in Aug 2023.
“The Union Budget in July announced slashing of import duties on gold and silver to 6% from 15%, a step aimed at combating smuggling and procurement of gold through illegal channels. This has made gold prices more appealing and provided comfort to retail consumers, thus encouraging purchases,” explained Haresh Acharya, director of the India Bullion and Jewellers’ Association (IBJA).
The demand in India and in Gujarat strengthens towards the end of the year, coinciding with the wedding season and major festivals including Dussehra and Diwali when bullion purchases are considered auspicious.
The India International Bullion Exchange (IIBX) saw 10.6 MT of gold imports in Aug, which is the highest monthly gold volume clocked on the exchange since its inception. “Ahead of the festive season, jewellers have replenished their stocks early in Aug as prices dropped since the Budget announcement. Given the geopolitical uncertainty and turmoil, prices in the international market are escalating and therefore, jewellers and bullion traders took advantage of the duty cut and price reduction. Gold prices could have hit a new record high of more than Rs 80,000 without the duty cut, but now they are trading below the peak, which is likely to increase demand,” Acharya added.
According to jewellers, retail demand for bullion as well as for jewellery has improved since the duty cut brought down prices. “We expect this momentum to continue in the coming months due to festival muhurats and the wedding season. The duty cut led to a positive sentiment among retail consumers, who were postponing purchases because of the price rise. A lot of investors are also attracted to buying gold. At the same time, people who have wedding occasions anticipated in the coming months are also making purchases,” said Manoj Soni, a member of the Jewellers’ Association of Ahmedabad.
Source: https://timesofindia.indiatimes.com/