With gold rates on a constant upswing, consumers this Dhanteras ended up paying almost 323% more for the glittering metal they Dhanteras day five years ago. It may now be unbelievable but Gold on Dhanteras day in 2005 was just Rs 6,000 a tola (10 grams). On Wednesday, it was Rs 19,950 per 10 grams in Nagpur market. Silver too jumped by 325% from Rs 11,675 a kg in 2005 to Rs 38,000 now.
Even compared to previous year, the prices of gold and silver jumped 23.5% and 39% respectively. The rates were Rs 16,150 per 10 grams and Rs 27,300 a kg in 2009. In a decade, the gold rates have gone up by 443% and silver by 469%. Both the metals were at Rs 4501 per 10 grams and Rs 8100 a kg respectively in 2000.
The high rates have had an impact on demand on Dhanteras day when it is considered auspicious to buy gold. Even though final figures are yet to be compiled, traders reported that Dhanteras sales have been consistently low during last four years. It began with a slump in 2006 and has continued since barring an exception in 2008.
President of Sarafa Association Kishore Dharashivkar said the turnover was less compared to last year especially with demand for ornaments dropping. However, there was a considerable offtake of coins and bars as investments. A phenomenal rise in silver prices also scared away consumers from lower income segment who buy silver ornaments.
There has also been a tangible drop in the demand for utensils and statues made of silver, he added.
This was also confirmed by Suresh Hundia, one of the directors in Bombay Bullion Association. "The prices are so prohibitively high that buyers from rural areas have literally vanished from the market," added Dharashivkar. Commodity analyst Amar Singh of Aditya Birla Money said there was a bullish outlook for gold in longer term though there may be some correction in near future. However, Pradeep Kothari of Karan Kothari Jewellers, had a positive experience. He said there was tremendous response for both jewellery as well as coins and bars.
Gold, which had touched a peak of $1385 an ounce, is still prevailing in the range of $1355- $1357. There is a chance of a slump if it breaches $1300 mark and then a likelihood of a rebound. Gold rates in India follow international trends.
Singh said there was hectic investment buying including by central banks. The third quarter of this year saw fresh investments to the tune of 38 tonnes in gold exchange traded funds taking it to 270 tonnes globally. Silver rates too are buoyant supported by an industrial demand as well as that for investments as a precious metal.
Ranjit Dani a financial consultant said that even as awareness about gold ETFs in India was increasing, it is still a long way to go. It has been seen that the stock brokers through which the product is sold are not much interested in hawking ETFs. It is because ETFs are normally a one time investment not offering a chance to earn repeated commission on frequent churning of portfolio as happens in stocks.
Even compared to previous year, the prices of gold and silver jumped 23.5% and 39% respectively. The rates were Rs 16,150 per 10 grams and Rs 27,300 a kg in 2009. In a decade, the gold rates have gone up by 443% and silver by 469%. Both the metals were at Rs 4501 per 10 grams and Rs 8100 a kg respectively in 2000.
The high rates have had an impact on demand on Dhanteras day when it is considered auspicious to buy gold. Even though final figures are yet to be compiled, traders reported that Dhanteras sales have been consistently low during last four years. It began with a slump in 2006 and has continued since barring an exception in 2008.
President of Sarafa Association Kishore Dharashivkar said the turnover was less compared to last year especially with demand for ornaments dropping. However, there was a considerable offtake of coins and bars as investments. A phenomenal rise in silver prices also scared away consumers from lower income segment who buy silver ornaments.
There has also been a tangible drop in the demand for utensils and statues made of silver, he added.
This was also confirmed by Suresh Hundia, one of the directors in Bombay Bullion Association. "The prices are so prohibitively high that buyers from rural areas have literally vanished from the market," added Dharashivkar. Commodity analyst Amar Singh of Aditya Birla Money said there was a bullish outlook for gold in longer term though there may be some correction in near future. However, Pradeep Kothari of Karan Kothari Jewellers, had a positive experience. He said there was tremendous response for both jewellery as well as coins and bars.
Gold, which had touched a peak of $1385 an ounce, is still prevailing in the range of $1355- $1357. There is a chance of a slump if it breaches $1300 mark and then a likelihood of a rebound. Gold rates in India follow international trends.
Singh said there was hectic investment buying including by central banks. The third quarter of this year saw fresh investments to the tune of 38 tonnes in gold exchange traded funds taking it to 270 tonnes globally. Silver rates too are buoyant supported by an industrial demand as well as that for investments as a precious metal.
Ranjit Dani a financial consultant said that even as awareness about gold ETFs in India was increasing, it is still a long way to go. It has been seen that the stock brokers through which the product is sold are not much interested in hawking ETFs. It is because ETFs are normally a one time investment not offering a chance to earn repeated commission on frequent churning of portfolio as happens in stocks.
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