It is the dream of every Indian family to buy gold jewellery and lots of it. This purchase of the precious metal gets into an overdrive during festivals, marriages and other family occasions. On the Akshaya Trithiya, a function in India, it is almost mandatory that every family at least buys one gram of gold. This leads to massive transactions and gold businessmen laugh all the way to the banks.
But this may not happen this season! With gold prices climbing new heights people are feeling jittery about venturing out to shop for jewellery during the oncoming festival season. As if the volatile ping-pong movements of the stock markets was not enough, gold prices is on an upward growth curve. Yesterday, gold prices in India touched a new high and reached Rs. 10,000 per 10 grams, though bullion trading closed at Rs. 9,915 per 10 grams at the end of the day, it offered no respite to the end user.
Top merchants and businessmen are expecting gold prices to rise, primarily because of a weakening dollar against most currencies including the Rupee. Those who had planned to purchase jewellery this festival, this price fluctuation is a clear disadvantage. Apart from paying a higher price they will have to pay a good percentage as making charges, wastage, etc. Jewellers are known to make margins even in these other tariffs.
Yesterday, gold prices in the international markets rose to $770 per ounce (31.1 grams). The last time gold prices had peaked was on May 12, 2006 when the shiny metal was priced at Rs.10,500 per 10 grams. But the recent (October 19) rise in gold prices, in dollar terms, has been the highest so far where it shot up to $770 per ounce (or 31.1 gram) in the international market. During the last fortnight, though gold prices went up to $750 per ounce, in rupee terms, but since rupee is stronger against the dollar, the prices hovered around Rs 9,500 per 10 grams. This appreciation didn’t limit to gold alone, silver prices also recorded a high of Rs 18,570 per kilo from its original price of Rs 18,435 per kilo.
The trend of gold getting more and more expensive is attributed to US investors who are buying up huge quantities of the yellow metal in a bid to combat the weakening dollar leading to a meteoric rise in the demand for gold. As international gold prices shoot up, jewellery obsessed Indians considering the onset of festival season are worried about having to dig into their savings to pay the extra buck for their favorite gold ornament. The latest price rise comes to fore after a 27-year gap of fluctuating prices of the yellow metal.
