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Home Gold News Dhanteras Shoppers Set to Break Jewellery Buying Records Despite Rising Gold Prices

Dhanteras Shoppers Set to Break Jewellery Buying Records Despite Rising Gold Prices

by anna

As Dhanteras and Diwali approach, demand for gems and jewellery is expected to remain robust, with sales in the domestic market potentially exceeding Rs 30,000 crore, according to industry experts. Despite rising gold prices, consumers are still keen on purchasing jewellery for the festive season.

The increasing prices of precious metals are prompting many to view gold as a stable investment. Additionally, silver is gaining popularity due to its lower cost and high industrial demand. Tapan Patel, Fund Manager-Commodities at Tata Asset Management, noted that purchasing gold during Dhanteras is seen as a way to attract prosperity and wealth. Many consumers opt for gold jewellery as gifts or for personal use during the festival, viewing it as a solid investment that retains its intrinsic value.

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“The current market is quite uncertain, leading to high volatility across asset classes. Investors may seek to diversify their portfolios with gold as a lower-risk investment,” Patel explained.

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Gold prices are currently hovering near all-time highs, exceeding $2,750 per ounce on COMEX. In India, gold prices have risen over 20% year-to-date, surpassing Rs 78,000 for 10 grams on the MCX. Patel attributed this price surge to various factors, including geopolitical tensions in the Middle East and potential U.S. Federal Reserve interest rate cuts.

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Experts predict a year-on-year sales growth of 10-15% this Diwali in terms of value, although volume may be affected by the higher prices. Silver has performed exceptionally well, with returns exceeding 40%, while gold has seen a 23% increase, outpacing stock market benchmarks.

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The Eastern Regional Chairman of the Gems & Jewellery Export Promotion Council (GJEPC) stated that gold remains a favored investment due to global uncertainties. There is also a noticeable shift from diamonds to gold, influenced by the rising popularity of lab-grown diamonds.

Industry leaders are advocating for a reduction in import duties on gold to support market sustainability. Ashok Bengani, President of the Ankurhati Gems and Jewellery Manufacturers Welfare Association, urged the Finance Ministry to lower import duties from 15% to 9%.

Despite higher gold prices, some industry leaders expect a 10-20% growth in sales. Suvankar Sen, MD & CEO of Senco Gold Ltd, anticipates a slight decline in sales volume by 12-15%, but a value increase of 10-12% due to demand for lower purity and lightweight gold jewellery, especially among working women.

Anjali Jewellers noted a trend towards personalized purchases, with customers seeking items that suit their individual tastes. Men’s jewellery, including bracelets, rings, and ear studs, is also gaining popularity.

Bablu De, President of the Swarna Silpa Bachao Committee, expressed optimism for the upcoming festive season, anticipating strong sales growth despite rising prices.

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