High prices, cash shortage take the sheen off Akha Trij

AHMEDABAD/SURAT/RAJKOT: The demand for gold this Akshaya Tritiya or Akha Trij, though much better than routine days, was not in line with that expected. On Wednesday, Akha Trij, the price of the yellow metal settled at around Rs 32,350 per 10g, gold sales in the form of bars, coins as well as jewellery, remained subdued. In fact, this time around, gold prices were the highest ever on an Akshaya Tritiya considering the recent past.
“As gold prices remained above the Rs 32,000-mark, bullion markets were dull and there was hardly any movement. The shortage of currency is also one of the reasons that affected demand for gold,” said Haresh Acharya, secretary, Bullion Federation of India.

Estimates by jewellers, analysts and bullion traders indicated that not more than 200kg gold was traded across Gujarat on Akshaya Tritiya.

Analysts claim, gold sales stood close to 350kg last year on Akha Trij. Wedding jewellery sales remained low too. “There was hardly any demand for wedding jewellery. The ticket-size was small as consumers don’t want to go through the KYC procedures. Cash shortage was one of the key reasons for a decline in demand, as very few people purchase gold using credit and debit cards and cheques,” said Rohit Zaveri, president, Ahmedabad Jewellers Association.

The situation was similar in diamond city, Surat, where sales were subdued on account of various factors such as high gold price as also liquidity issues in the diamond and textile markets, currency shortage and the extreme heat.
Jewellers said that most jewellery showrooms had very poor or no footfall at the mahurat time in the morning. While the festival generates Rs 100-120 crore worth of sales turnover in a single day in gems and jewellery industry, this time, the sales are less than 60% of what is expected on the day.
Member of All India Gems and Jewellery Trade Federation (GJF), Nainesh Patchigar said, “Akshaya Tritiya is a bit slow this year due to various factors including increasing gold prices and currency shortage. Over the last few days, people in Surat are witnessing cash shortage and many ATMs are unable to dispense cash. Compared to previous year, sales is in the range of 60%.”
On the other hand, Rajkot witnessed significant gold sales on Wednesday with gold market on Palace Road being crowded with buyers. Bhayabhai Soni, president, Rajkot Gold Jewellers Association, said, “After recession in the business for last few months, sales were good on Akha Trij. Most customers purchase ornaments while some ask for bullion with the special gold coins of 1-5 grams being introduced.”
by via Surat News, Latest Surat News Headlines & Live Updates - Times of India