No Diwali glitter for gold; jewellery sales seen plunging 60%

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Despite demand, gold jewellery sales are likely to decline by up to 60% this festive season due to stock crunch following restrictions on imports, according to industry experts.”Demand is definitely there for gold jewellery and coins. However, we do not have enough stocks in the market to cater to the demand of this festive season as there were no import since the last 2-3 months,” Kumar Jain, Mumbai Jewellers Association Vice-President, told PTI here today.Customers are, therefore, buying silver or diamond, he said.Due to a slew of government curbs to contain current account deficit (CAD), there was no gold import in August and September. This month the yellow metal that was lying at Customs warehouses was released into the market, Jain said.
Some of the demand is being catered through earlier stocks and recycled jewellery, he added.
Echoing a similar view, former President of Bombay Bullion Association Suresh Hundia said gold and gold jewellery will witness about 60% decline in sales, while for silver the drop will be lower at 50%.
“Due to price rise and high inflation the general sentiment for bullion is low, which is getting reflected during the festive season,” he added.According to Gitanjali Group Chairman Mehul Choksi, there are reports of decline in footfalls at stores compared to last year and this will get reflected in drop in sales.
“We are getting reports from across the country that there has been 30-35% less footfalls in the jewellery showrooms compared to last year. This will have an impact on overall sales and we expect 30-35% drop in sales in gold and 10-15% in diamond jewellery,” he said.A combination of high prices and less stocks has created an overall vacuum in new designs in the industry, Choksi added.
Source:PTI
Source:Bullion Bulletin

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