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Joy Alukkas, Malabar Gold & Diamonds and Senco Gold & Diamonds said customers had held back on purchases expecting a cut in import duty on gold in the budget, which did not happen. This prompted them to loosen their purse strings for the yellow metal.
“Now that prices have fallen and there is no chance of a cut in import duty, the consumers are now flocking to our stores,” said Joy Alukkas, chairman of Kerala-based Joyalukkas group. “Going ahead, the sales will remain good as the rupee is strengthening against the dollar and internationally prices are falling, which will make gold cheaper in India.”
Southern India accounts for nearly 40% of the country’s total jewellery demand. Alukkas said the demand in February increased by 15% from January. “The average ticket size is Rs 60,000–70,000 and people are buying light to medium jewellery,” he said.
On Thursday, international gold rates hit a one-month low as fears of a recession in the US eased following strong economic and retail sales data from the country. In India, spot gold was trading at Rs 56,343 per 10 gm, down from Rs 58,689 per 10 gm in the second half of January.
“The decrease in gold price is acting as a great purchase trigger for consumers, especially in the ongoing wedding season,” MP Ahammed, chairman of Thrissur –based Malabar Gold & Diamonds said. “Those who were deferring their gold jewellery purchase due to higher gold prices have hit the markets. We are witnessing healthy footfalls and demand at all our stores.”
India’s price-sensitive eastern market is also witnessing a surge in demand because of the price drop. “We have witnessed good demand in the last 7-10 days,” Suvankar Sen, managing director of Senco Gold & Diamonds, said. “The average ticket price is in the range of Rs 35,000 and Rs 40,000. There is also demand for diamond studded jewellery.”
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