Buyers return to stores as gold prices cool down
Wed June 12 2024
Kolkata: A 4.5 % fall in in gold prices in three weeks from a high of ₹74,222 per 10 gm has boosted consumer sentiment. Mumbai's Zaveri Bazaar, the largest gold market in Asia, is buzzing with activity and jewellers Joyalukkas, Senco Gold & Diamonds, PNG Jewellers, Kama Jewelry and others have seen footfalls and demand rising by 10-15% from two months ago.
The price fall has also prompted a section of consumers to buy gold bars and coins. The absence of the election model code of conduct, which was effective from the beginning of April, has also brought back consumers to the market as they can now carry more cash beyond ₹50,000 and buy jewellery.
The Model Code of
Conduct (MCC) prohibits carrying cash exceeding ₹50,000 and also new
items worth more than ₹50,000 without any supporting documents.
Kumar Jain, owner of Zaveri Bazaar-based Umedmal Tilokchand Zaveri, said "The mood is upbeat not only in Zaveri Bazaar but also at other places in the country. Jewellers have started restocking new products and customers have come out to buy gold. In the coming weeks, we will see purchases pick up further."
On Tuesday, gold was hovering around ₹70,900 per 10 gm.
"We have seen good footfalls due to a price drop and formation of a stable government at the centre. Also, people can now carry more cash to buy jewellery. There have been a lot of restrictions on cash movement, which too had dampened the demand from the beginning of April. Demand is up by 15% ," said Saurabh Gadgil, managing director of Pune-based PNG Jewellers.
The yellow metal fell on profit booking, particularly after the release of the Federal Reserve meeting minutes, which hinted at a lack of confidence among policymakers regarding the possibility of imminent interest rate cuts.
The price fall also prompted families who have weddings in the later part of the year to buy jewellery. Suvankar Sen, managing director of Senco Gold & Diamonds said "The gold price fall has encouraged buyers to return to the store and start their wedding shopping. They fear that prices may move up, so they are buying gold in advance. Demand has gone up by 15% in the last one week."
Baby George, CEO of the jewellery retail chain Joyalukkas, said their stores across India have witnessed a 10-15% increase in sales. "Softening of gold prices is the prime reason for this uptick in sales."
Source: https://www.msn.com