Gold rush: Wedding bells drown out price hike impact
Tue Dec 03 2024
A bumper wedding season has turned Gujarat into a gold rush hotspot, defying the steepest price hikes in recent memory. With the yellow metal brushing against the Rs 80,000 per 10g mark in Nov, you would expect buyers to take a step back. Instead, they doubled down, sending Nov gold imports soaring by 394%.
According to data from the Ahmedabad Air Cargo Complex (AACC), 20.07 metric tonnes (MT) of gold was imported into Gujarat this Nov, compared to just 4.06MT during the same month last year. The Diwali-New Year festive fervour, closely followed by a string of auspicious wedding muhurats, kept jewellers and bullion traders busier than ever.
For context, the Oct-Nov period together witnessed an 80% jump in gold imports over the previous year, despite prices testing buyers' patience this year. On Oct 30, gold reached an all-time high of Rs 82,300 per 10g before settling slightly lower. On Monday, the yellow metal price settled at Rs 78,700 per 10g in the Ahmedabad market.
"Even as gold price remained volatile, the demand continued well for two reasons: bullion investments and weddings. Gold yielded high returns for investors, as a result of which many continued their bullion investments the moment prices went down to hedge. Moreover, those who had weddings scheduled in the family had to buy gold," said Haresh Acharya, director of IBJA.
Weddings particularly drove the demand well. According to jewellers, in cities like Ahmedabad and Surat, urban buyers are splurging on contemporary, customised designs at higher price points, reflecting a penchant for luxury and individuality. On the other hand, rural buyers remain price-sensitive, sticking to traditional gold jewellery that mirrors deep-seated cultural traditions, said jewellers.
"Gold, traditionally favoured for weddings, continues to dominate, while younger buyers are leaning towards platinum and diamond for a modern touch. Interestingly, many buyers are offsetting the price hike by trading in older jewellery, but the cultural significance of gold for weddings remains unparalleled," explained Aksha Kamboj, vice-president of the India Bullion and Jewellers Association (IBJA), capturing the sentiment.
"Interestingly, ticket sizes for urban buyers have grown slightly, with a noticeable shift towards premium pieces for wedding celebrations. In rural markets, spending has remained steady, prioritising investment-worthy items over trends. Yet, in both spheres, the resilience of gold demand proves that no matter the cost, the glitter of gold is inseparable from Indian culture — especially during festive and wedding seasons," he further explained.
Source: https://timesofindia.indiatimes.com/