Jewellers remained confused through the day and sales slumped after currency denominations of Rs.500 and Rs.1,000 ceased to be legal tender since Tuesday midnight.
While a large numbers of jewellery shops across the State remained shut on Wednesday, those who conducted business registered a clear fall in sales. The confusion was palpable in their statements welcoming the decision, offering support, but opinions differed over the scale of its long-term impact on gold business.
Joy Alukkas said the jewellery outlets owned by the group only opened at 5 p.m. on Wednesday. “While we hope that the measure to demonetise will rectify the pitfalls in the system, it has given rise to confusion at least for sometime now. We received numerous calls through the day, enquiring if we would sell jewellery against cash in the denominations that have ceased to be valid. The sale will be low for some more time and the common man, who doesn’t have a PAN card or bank account, is likely to be affected. We hope that the demonetisation is just a beginning, the positive effects of which would take at least a decade to show,” he said.
M.P. Ahamed of the Malabar Group, who is general secretary of the Kerala Jewellers Federation, said that the short-term confusion had led to drop in sales. “But it is going to benefit the gold business in the long run. More and more people will opt for gold as the internal hard currency and invest ideally 15 per cent of their wealth,” he said.
Savio Thomas, senior personnel manager, Josco, said the group’s outlets also remained shut for the day, owing to bank holiday and motor vehicle strike in Ernakulam. He said bulk purchase of gold would be meagre till new higher denomination currency was issued.
'Gold may take the hit'
Gold wholesaler Sajeev K. Varghese thought that the move, while being positive, would adversely impact gold trade in times to come for a little longer period than expected.
