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Updated: April 28, 2014 22:29 IST

Soaring prices take sheen off gold

S. Sandeep Kumar
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Visitors at a jewellery outlet in Vijayawada. - PHOTO: V. RAJU
THE HINDU
Visitors at a jewellery outlet in Vijayawada. - PHOTO: V. RAJU

Jewellery managements attribute the moderate sale of the yellow metal to factors like poll season and cautious approach of customers. The current cost of 10 grams of 24 carat gold is nearly Rs. 30,000, and customers expect the prices to come down after the new government takes over.

There is not much of a glitter in jewellery outlets in the city this season. Sales are moderate, and managements attribute it to factors like poll season, rising gold prices and cautious approach of customers.

Generally, jewellery outlets look forward to this season to improve sales and come up with attractive designs. Incidentally, the designs put on display do not finding many takers.

“Most people have purchased ornaments well in advance, and compared to the last marriage season, sales have neither gone down nor increased. It is moderate, and I hope things will improve in the coming days,” says V. Rama Krishna, store manager, PMJ Jewellers, Moghalrajpuram.

The current cost of 10 grams of 24 carat gold is nearly Rs. 30,000, and customers expect the prices to come down after the new government takes over. People do not want to buy gold unless it is a necessity. Anticipating that prices will come down, limited budgets are being allotted to gold, and, as a result, the quantum of purchase is on the decline, explains a corporate jewellery outlet manager.

“Usually gold is purchased by paying cash, but thanks to the Model Code in force, people are anxious about carrying cash. Many are wary of being caught by police and the cumbersome process of running from pillar to post to settle things. Perhaps, this also is casting an impact on the sales,” he says.

This apart, many women prefer to exchange their old ornaments with new ones. “With not much of cash flow in the market, buyers are opting to melt old ornaments and get new ones designed.

This serves two purposes – they can redesign ornaments without spending much. All these have led to moderate sales, and the usual excitement is definitely missing,” says Jogulamba Prasad of Tanishq Jewellers.

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