Kolkata: Gold and silver scaled record highs on Monday, potentially impacting jewellery buying ahead of the coming wedding season. Global macroeconomic uncertainty, escalating geopolitical tensions, and expectations of US Federal Reserve rate cuts are among factors fuelling the runway rally in the two precious metals.
Gold was trading at ₹1.4 lakh per 10 grams and silver at ₹2.6 lakh per kg. At such elevated levels, the industry is expecting a 30% drop in wedding-related gold jewellery purchases between January and July compared with a year earlier.
While gold climbed ₹3,000 per 10 grams in a single day, silver surged ₹19,000 per kg, with both emerging as safe-haven assets for investors.
At Zaveri Bazar, among India’s largest precious metals trading hubs, investors are flocking to buy gold and silver bars. “Those who have extra money are buying gold or silver bars,” said Prithviraj Kothari, managing director at RiddhiSiddhi Bullion, a Zaveri Bazar-based bullion dealer. “Gold is the first preference among investors, and they are buying gold bars of 10 grams, 20 grams, and even 50 grams. The sentiment is bullish for gold as central banks across the globe are buying the metal.”
Internationally, gold rose 1.6% to cross the $4,600-per-ounce mark for the first time, and silver by 5.45% to hit a lifetime high of $84 per ounce.
Surendra Mehta, national secretary of the India Bullion and Jewellers Association, said reports from jewellers across the country showed a 30% volume decline in wedding-season demand for gold jewellery. “If prices rise further, the dent in demand will be even more,” he said.
Some jewellers are seeing consumers shift towards lower caratage gold, mainly due to price sensitivity rather than reduced intent.
Jewellers such as Suvankar Sen, MD of Senco Gold and Diamonds, said volume offtake has fallen 15-20% as buyers are preferring lightweight jewellery or lower-carat jewellery to stay within their wedding budgets.
Vikas Kataria, promoter of listed jeweller DP Abhushan, which operates in 10 cities across Madhya Pradesh, said, “Customers with planned wedding purchases are not cutting back on their overall budgets. Instead, they are realigning their preferences, opting for 18- and 14-carat gold for bridal designs.”
Last week, gold ended nearly 4% higher, while silver jumped a sharp 12%, as markets reacted to weaker-than-expected US jobs data and a more uncertain global backdrop.
Geopolitical risks have once again taken centre stage. Tensions remain high amid rising unrest in Iran, the ongoing Russia-Ukraine war, the US capture of Venezuelan President Nicolas Maduro, and renewed signals from the US about taking control of Greenland.
