Hyderabad: Gold surging past the $2700/ounce mark for the first time on Oct 19, 2024 and remaining embedded over that level ever since with a new lifetime high of $2758.45 on Oct 23 in international spot markets, has left jewellers sweating at the prospect of a lacklustre Dhanteras and Diwali this year.
With prices in the Indian market too reigning at over 80,000/10 gm (including taxes) amid the festive season, the industry is apprehensive of a potential 20-30% drop in sales this Dhanteras, which falls on Tuesday.
All India Gem & Jewellery Domestic Council director Avinash Gupta said the industry is expecting at least 20% lower sales than last year due to the unprecedented rise in gold prices. “Every year, there is a visible Dhanteras rush even before the auspicious day as people come in to make bookings, but this year the rush is missing at most showrooms. Sales could even be impacted by more than 20%,” he said.
“There are hardly any buyers. Sales are down by 70%. The Dhanteras festive rush is missing because it is not just gold that is at all-time highs; silver too is hovering around 1 lakh per kg. Until the crisis in the Middle East continues, gold will remain high,” said Anil Jain of M Nemichand Jain Jewellers in Secunderabad’s famed Pot Market.
Echoing this sentiment, Darshan Gupta, Partner at Mangatrai Jewellers, said the response so far in terms of pre-bookings has been lukewarm. “The buying sentiment is missing due to high prices, but we expect some token purchases due to the auspicious day. We expect at least 20-30% lower sales compared to last Dhanteras,” Gupta said.
However, PK Siraj, retail head (Rest of India) at Malabar Gold & Diamonds, expressed hope that the upcoming wedding season post-Diwali may come to the rescue of jewellers, despite the festive mood being absent among buyers. “I am optimistic because there are many marriages coming up, but the mood is not that great as the gold rate is very high,” he admitted.
The Dhanteras sentiment appeared to be dampened despite gold trading at lower levels of $2730 on Monday. “Gold resumed trading on a weaker note on Monday due to a declining safe haven demand after Israel’s attack on Iran was less severe than expected. In international markets, spot gold on Comex was trading at $2730, down $16 from the previous day,” said Saumil Gandhi, senior analyst – commodities, HDFC Securities.