Prices soar but gold glitters this Dhanteras

“The rally in gold prices has further strengthened the sentiment, and customers continue to make confident buys, viewing precious metals as trusted and long-term assets amid all the uncertainties right now,” said Saurabh Gadgil, CMD, PNG Jewellers.

Gadgil said since Dussehra there has been steady demand across gold, diamond and silver jewellery.The reduction in income tax rates for individuals from this fiscal and the recent cut in GST rates, could be another reason for the continuing demand for these metals, MP Ahammad, chairman, Malabar Group said.“While the gems & jewellery sector has been excluded from GST reforms, we believe the resulting increase in disposable income will indirectly boost consumer demand,” Ahammad said.

There’s some change in consumer behaviour across segments due to higher gold prices.

“There has been an increased preference among certain customer segments towards lightweight and lower-carat pieces like 18K or 14K jewellery that offers price flexibility and style.”In the last two years, the price of gold in the physical market has more than doubled while in the last one year the rise has increased about 65% to close to Rs 1.3 lakh/per 10 grams.

There’s also been a rising trend among customers to exchange old gold jewellery for new ones, especially in smaller towns and rural areas.

“At above Rs 1 lakh level, gold is mostly out of reach of most people in smaller places.“I’m seeing lots of people exchanging their old gold ornaments and getting new ones,” said Somnath Ghosh, proprietor, S Ghosh Jewellers at Hooghly Ghat, a Kolkata suburb.

Silver, however, is witnessing a slightly different situation.

There is high demand, but not enough supply, Gadgil of PNG Jewellers said.