High prices, festival fatigue dent wedding gold sales
MUMBAI – Two-month-high prices and shopping fatigue after a string of festivals last month have seen Indian gold demand for the wedding season easing this week.
Dealers and traders said retail shopping for trousseaus is yet to commence as consumers wait for the right price and the right time to buy gold.
“Demand will pick up,” said Chintamani Kaigaonkar of jewellery shop Chintamanis in Dadar. “Last weekend was not so good, but things might get back to normal in the coming weekend.”
Gold prices moved north on overseas investment demand, driven by concerns of U.S. economic growth. A disappointing manufacturing index on Wednesday propelled gold to two-month highs, prompting a break in Indian prices above the psychological 9,000 rupees per 10 grams mark on Thursday.
But that doesn’t mean Indian brides won’t be shopping for the yellow metal any more.
Dealers said most wedding shoppers typically buy their gold much in advance, and this year they would have taken advantage of a big price dip ahead of Diwali last month.
Yet, last-minute purchases would be enough to keep the trade busy in the next few weeks, dealers and traders said.
“Demand is down as prices are extremely unstable and volatile,” said Afshin Nabavi, senior vice president at Geneva’s MKS Finance S.A. “I think it will revive, but traders wait for stability before coming into the market.”
FEW AUSPICIOUS DAYS
With most Hindu auspicious days for weddings falling in December, eleventh-hour shoppers still have time on their side.
“This is a very unusual year with no auspicious days in November,” said Jai Raj Gupta, chief executive officer of wedding arrangement company Shaadionline. “There are only 4-5 days in December.”
Retailers said buyers would be happy with prices below 9,000 rupees per 10 grams.
“We are not satisfied with current prices,” said Nilesh Shah, partner at Shubham Jewels in south Mumbai. “But there is still time to wait for prices to fall as the weddings are starting next month.”
Shah said a drop to 8,750 rupees would be ideal to attract shoppers.
On Thursday, spot gold was quoted at 9,050 rupees in Mumbai, up 80 rupees from Wednesday.
(Reuters)
