Gold Discount Disappears as Market Turns Positive
Jewellers see renewed interest, expect steady prices
Kolkata: Discounts on gold have disappeared as jewellers have started restocking the precious metal a month after introduction of 3% GST on gold, as market sentiment turns positive. A southward price movement of gold due to strengthening of the rupee against the dollar has also helped consumers take interest in the yellow metal.
Gold prices dropped by 2.41% since GST was rolled out as the rupee firmed up against the dollar bringing down its landed cost. The price difference between pre-GST and post-GST has narrowed down to .₹ 200 per10 gm due to a drop in the price of gold.
At present, 10 gm of gold is .₹ 29,500 while it was .₹ 29,300 in June when jewellery sales spiked in anticipation of gold becoming dearer after GST rollout.
Talking to ET, gold trade analyst Bhargava Vaidya said, “Demand for gold is likely to rise as prices have fallen and are remaining more or less steady. This is why the discount on gold has disappeared, and I do not see prices to fall drastically from the current level. Internationally, it may come down from $1,250 per troy ounce to $1,230. There’s no immediate trigger for prices to either rise or drop. There is not much geopolitical tension in the world.” Mukesh Kothari, director, RiddiSiddhi Bullion, said, “Jewellers are buying bullion to meet the orders they had booked at the show. Moreover, they are also restocking to meet the upcoming festive season demand.”