Jewellery shops see increased footfall as gold prices dip

By Tinisha Rachel Samuel

CHENNAI: A sharp dip in the price of gold has sent denizens into a tizzy, given the crowd seen in jewellery stores across the city.

“Gold rate is now favourable to consumers. The price will dip more in the following days. We’re seeing a large number of customers these days, as the cost per sovereign (8 gm of gold) has gone below Rs 43,000. The reason for the fall in gold price is because many countries are selling it at a cheaper cost,” says Jayantilal Challani, president, Jewellers and Diamond Traders Association of Madras.

However, jewellers are not surprised at the growing crowd in their stories, especially considering its festival time. “With festivals approaching and the gold rates now at a low, this is the right time for customers to buy jewellery for weddings and other auspicious occasions,” said K Shankar, a goldsmith based in Choolai.

With a gradual decline of about Rs 200/gram in the past 10 days, jewellers consider it to be the best time for sales. The gold price currently stands at approximately Rs 5,360/gram, industry sources said.

“Gold price varies according to the market fluctuations. It’s due to the US temporary funding bill which should have been passed by Saturday. Otherwise, the rate will come down again. After it was rejected by the US House of Representatives on Saturday, the US federal agencies will be shut down for the next 30 days. This affects the economy and ultimately, the gold price as well,” Ajith Kumar, owner, Shree Jewellers, Nungambakkam.

Kumar also opined that it would be rare for gold rates to decrease to this extent in the future. “This is the best time to purchase gold. Consumers believe that the rate will go down to Rs 4,000 and, that it would not go beyond Rs 5,200. The rate of the gold was Rs 5,550/gram two weeks before and now the rate is Rs 5,360,” he added.