Impact of High Gold Prices on Akshay Tritiya: Key Insights
Jewellers across India are gearing up for a surge in consumer demand this Akshaya Tritiya, despite gold prices reaching historic highs of Rs 1 lakh per 10 grams. The auspicious occasion, celebrated on April 30, is traditionally marked by increased gold purchases, prompting the industry to adapt by offering lighter, more affordable ornaments. Industry leaders express optimism that the cultural significance of gold will drive sales, even as prices test consumer patience.
Consumer Sentiment Amid Rising Prices
As Akshaya Tritiya approaches, the gold market is filled with anticipation. Rajesh Rokde, chairman of the All India Gem and Jewellery Domestic Council (GJC), highlighted the cultural importance of this day, which typically sees a spike in gold purchases. Despite the current high prices, Rokde believes that demand will remain strong, particularly for lightweight items. On Friday, gold traded at Rs 95,075 per 10 grams on the Multi Commodity Exchange (MCX), with international prices facing resistance around $3,330 per ounce. The symbolic value of gold, he noted, is likely to outweigh any short-term hesitance from buyers.
Rokde acknowledged that while some consumers may be cautious due to soaring prices, the allure of gold as a safe-haven asset and its integral role in Indian traditions will likely lead to positive sales outcomes. The jewellery industry is responding by rolling out a diverse array of products to cater to various budgets and preferences, ensuring that consumers have ample options to choose from.
Innovative Designs and Consumer Choices
Avinash Gupta, vice-chairman of the GJC, echoed Rokde’s sentiments, suggesting that while high prices may deter some buyers, the cultural significance of gold will ultimately drive demand. He predicted that the volume of gold purchases might remain stable compared to last year, or potentially decrease by 10 percent. The jewellery sector is showcasing a mix of innovative designs alongside classic pieces to meet the diverse needs of consumers.
Sachin Jain, regional CEO of the World Gold Council, emphasized that gold purchases have long been a vital part of Akshaya Tritiya celebrations, symbolizing prosperity and good fortune. He noted that the current surge in gold prices marks a significant period for the metal, with global prices rising by 25 percent since January and reaching a record high of $3,500 per ounce. Demand is expected to encompass a wide range of products, including jewellery, coins, bars, gold ETFs, and digital gold.
Market Outlook and Expectations
Saurabh Gadgil, chairman and managing director of PNG Jewellers, expressed confidence that the festive spirit would remain strong despite high prices. He acknowledged that while volume has been under pressure due to soaring gold prices, the timing of Akshaya Tritiya coinciding with a busy wedding season could lead to a robust performance similar to what was observed during Gudi Padwa. Gadgil anticipates a strong turnout for both new purchases and scheduled deliveries on the day.
He also noted that old bars and coins are expected to perform well, as consumers continue to view gold as a reliable long-term investment. The next ten days leading up to Akshaya Tritiya will be crucial in shaping market momentum, but all indicators suggest a promising outlook for the festive occasion ahead.
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