Gold Prices Soar 60%, Slowing Sales During Ganesh Chaturthi Festival

Gold prices have surged by a staggering 60% in just one year, rising from Rs 98,000 to Rs 1.57 lakh per 10 grams in Mumbai's spot market. This sharp increase has led to a decline of around 15% in gold sales during the Ganesh Chaturthi festival this year, with consumers either reducing the quantity they bought or opting for lighter jewelry due to higher costs.

Jewellers remain hopeful that demand will recover as the festive calendar progresses towards the peak wedding season. According to Surendra Mehta, national secretary of India Bullion & Jewellers Association, 'Domestic gold prices have remained at a historic high, which has impacted volume sales. But overall the mood is optimistic, with many people resorting to old gold jewellery exchanges to buy new jewellery, which is mostly lightweight.'

As the festive season begins, retailers are seeing growing interest in diamonds as buyers seek jewelry that can serve multiple purposes, from celebrations and gifting to regular wear. Kumar Jain, owner of Umedmal Tilokchand Zaveri, a 100-year-old outlet in Mumbai's Zaveri Bazaar, said demand for bullion in the form of coins and bars has picked up during this year's Ganesh Chaturthi.

The Bureau of Indian Standards (BIS) has increased the hallmarking fee for gold articles from Rs 45 to Rs 75, effective just before the start of the festive season. This change is expected to impact jewellers who send their products for hallmarking under the BIS framework.