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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
 Posted - 10/25/2008 : 11:52:16
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This information could go under bullion or economics (inflation) but since it deals with gold I suppose this is a good place to post this-
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Consumers shying away from gold this Diwali
24 Oct, 2008, 1110 hrs IST, IANS
NEW DELHI: Diwali is the time when most people shop for gold and stores reap rich profits, but this year rising gold prices and high levels of inflation have kept buyers away.
Sale of gold jewellery has not been bad, but it has not been as robust as in other years, forcing retailers to wait for Dhanteras, two days before Diwali when people traditionally buy gold and utensils.
"Though customers do indulge in festive shopping, the volume of sales have gone down," Mehul Choksi, chairman and managing director of Gitanjali group that deals in brands such as Nakshatra, D'damas, Gili and De Beers, told media.
Echoing similar sentiments, Harish Bakshi, senior manager in charge of sales and promotion at Ashwani Kumar's Mehrasons Jewellers, told IANS: "An overall decline of 20-30 percent in terms of sale of gold jewellery cannot be ruled out."
The rate of the yellow metal is fluctuating between Rs.12,400 and Rs.15,500 per 10 grams at the moment,
unlike last year when the price was close to Rs.10,100 around Diwali time.
Inflation, too, has played havoc with a jump in rate.
However, World Gold Council associate director Keyur Shah said inflation is not the sole reason for the plummeting sale of gold jewellery, adding that buying gold jewellery is usually a "planned purchase and people save money for it for months together".
According to Sandeep Kulhali, vice president at Tanishq, the Tata Group's jewellery division, said August saw a rise in sales, and people are now avoiding spending on gold yet again around Diwali.
K.C. Jain, partner at KK Jewellers, cited other reasons.
"Share market crash,
overall collapse of the economy,
rising price of gold
and high inflation rates
have limited purchasing power, and people have become more conscious," he said.
"It has become so difficult to touch gold now," said Neelam Sharma, a homemaker who used to buy gold each year on Diwali but is refraining from doing the same this year.
"I keep a check on the rate of gold before I go out shopping for jewellery since I want to get a good deal and not shell out all my savings," affirmed Mansi Dhar, who is a trainer with a business process outsourcing firm.
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In the US we look at the price of gold and say "What happened? Whats going on? Why is it that gold is selling for so little?"
Overseas the price of gold is going up, at least where inflation is pusing up the cost of living.
The dollar is getting stronger because investors are spooked by the panic in the markets, so investors are dumping everything and anything and piling into "safe" Treasuries, causing a strong demand for the dollar. For those overseas who can't buy Treasuries, buying gold to preserve their wealth is the next best thing, especially if the price of gold is rising in price in relation to the local overseas currency.
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Edited by - pencilvanian on 10/25/2008 12:06:18 |
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Ardent Listener
Administrator
USA
4841 Posts |
 Posted - 10/25/2008 : 13:16:49
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I'll give the typical hard core hoarder's reply. So they aren't buying gold? Good, more for the rest of us |
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Yet more on inflation & gold
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