V.M. Kalavalli, a resident of Chetpet, bought her first gold chain that weighed four-and-a-half sovereigns, for Rs.725 in 1970. She now has to shell out more than double the amount for buying a gram of gold.
One gram of 22-carat-gold now costs Rs.1,801, as on Friday. The continuing rise in the gold price over the last few years has affected many wedding plans and festival purchasers.
Ms. Kalavalli said, “Purchasing gold jewellery is not only a status symbol but also a good way to invest. But these days, I refrain from buying gold as it is becoming out of reach. There is also a fear of theft as the value of one sovereign has shot up.”
G. Devaraj, a resident of Kilpauk, said the escalating cost of gold and silver is becoming worrisome.
“The budget for gold jewellery in my daughter's wedding is almost 40 per cent of the total expense. For the same value, I could have purchased double the amount of jewellery a few years ago.”
Though the rising price is a deterrent, people continue to buy gold as it is considered the best investment option. Jewellers in the city said that most of the customers are either exchanging old gold jewels for new or buy coins. Silver jewellery is also becoming popular among youngsters. One gram of silver is priced at Rs. 36.60 N. Anantha Padmanabhan, chairman of Gold Club of Chennai, said the cost of gold has now gone up by 20 per cent from last year's price.
The impulsive buying of gold seems to have come down among the people. The steep rise in price could be contributed to many factors, including more investors in online gold trading and downslide in U.S. economy.
“We expect a 25 to 30 per cent increase in business during this festive season. Many jewellers have begun promoting light weight jewellery to attract customers. There may be a slight dip in the price in six months,” he said.