If you are planning to give away gift in gold – say a shiny new necklace for someone dear to you or a gold coin as a corporate gift or a gold-plated statue for branding’s sake – do not wait till Diwali. If gold is there on your mind for this festive season gifting and the upcoming wedding season, you may do it now.
If a Hindustan Times news report is to be taken into consideration, you may have to spend something close to Rs. 40,000 per 10 gm. Here are the scenarios and reasons behind it as stated by The HT staffer Manish Pachouly:
If you were taking heart in the minor fall in the price of the yellow metal in the first week of September – Rs. 31,700, experts say this slide is unlikely to last. The fall of the rupee against the dollar has already driven the price of the precious metal up from Rs. 28,270 on August 1 to Rs. 33,265 on August 28, amid a crackdown on imports by the Central government which is desperate to curb the outflow of foreign exchange.
Rising prices have already hit import volumes, with the amount of gold brought into the country dipping from 162 tonnes in May to just 47 tonnes in July. After the curbs, imports dropped to about 5 tonnes in August. Customers, meanwhile, are recycling old jewelry rather than buying fresh gold. “There is currently zero demand for fresh gold,” said Kumar Jain, spokesperson for the Bombay Bullion Association and owner of a Mumbai-based jewelry store.
In November, as demand soars further during Diwali – especially on Dhanteras which is considered the most auspicious day for buying gold — and ahead of the wedding season, experts say the price is expected to breach the psychological barrier of R40,000 per 10 gm. Since the curb on imports will most likely stay in place until February — in other words, all through the wedding season — the short supply could boost prices further.
“During the festive and wedding season, there will be a supply crunch and that could further increase the prices,” according to the All India Gems and Jewellery Trade Federation. With imports curbed, he said one key source of gold is sale by customers and investors.