Steep Decline in Gold Prices Boosted Jewellery Demand

SEATTLE (Scrap Monster): The Jewellers’ Association of Ahmedabad (JAA) noted that jewellery demand has witnessed significant strength, following recent correction in gold price from its peak. The change in policies by the government too has led to increased demand for the yellow metal.

According to Jigar Soni, President, JAA, the recently announced cut in basic customs duty on gold and silver from 12.5% to 7.5% has resulted in reduction of prices of these precious metals. The easing of restrictions on the number of people allowed attending wedding functions have led to increased number of such events taking place. The wedding gold purchases as well as routine purchases have picked up, thanks to falling gold prices, he added.

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Incidentally, gold prices have recorded 13% dip from its peak recorded during the initial week of the year.

With more weddings likely to take place next month on account of Akha Trij, gold purchases are likely to maintain its strong trend, observed retailers. The demand for gold and jewellery has gone up significantly, both in urban as well as rural areas of the country. The uptick in gold demand is quite evident from the higher gold imports, they noted.