Jewelry stores in India did a brisk business on Tuesday as people flocked to buy gold on the occasion of Dhanteras – which is considered by many Indians to be an auspicious day to buy gold and jewelry.
The demand for the yellow metal has been showing signs of revival after the retreat of the deadly Covid-19 second wave and with the revival of economic activity after the easing of lockdowns. Gold prices have been softer at 47,644 rupees per 10 grams as against 57,000 rupees in August.
However, prices are much higher compared with 39,240 rupees per 10 grams during last year’s Dhanteras.
Trade body India Bullion & Jewellers Association expects gold sales to return to pre-Covid levels and surpass those of last year’s by 15-20%, Economic Times reports. Around 20-30 tons of gold are sold on a Dhanteras day and industry players hope that this year the volumes will be slightly higher.
Both online and offline sales have been brisk due to soft gold prices. Jewelers claim there has been a revival of offline shopping as store entries increased by 40% when compared with the year-ago period. The Confederation of All India Traders said the jewelry industry has emerged from the pandemic-induced slump, Press Trust of India reports.
World Gold Council Regional CEO (India) Somasundaram P R said that pent-up demand, soft prices and good monsoons, combined with an easing of lockdown, will lead to a strong surge in demand.
India’s gold imports have been on the rise after a lull during the pandemic-induced slowdown last year. The country imported 91 tons of gold in September, compared with 12 tons a year earlier. Low gold prices in the global market had encouraged jewelers to step up purchases in anticipation of brisk sales during the festival season.
Reports across the country indicate that most customers are buying lightweight jewelry. Jewelry has sold much better than bars and coins. Jewelers are finding it difficult to cope with the demand as the inventory has been low. The recent lockdowns had led to a fall in jewelry production and affected the pace of jewelry hallmarking.