The possibility of complete lockdown in most States to fight the second wave of Covid menace may cloud hopes of fast recovery in gold jewellery demand during the forthcoming festival and wedding season.

However, the consistent fall in gold price in the last four months is the only saving grace to attract consumers interest for buying gold jewellery.

Gold prices have fallen by ₹5,122 per 10 gram to ₹45,176 on Monday against ₹50,298 in January.

Unfortunately, for jewellers, whenever gold prices fall consumers switch over to wait and watch mode expecting prices to fall further.

Aditya Pethe, Director, WHP Jewellers, said the recent rise in Covid cases has again stirred up the market and filled consumers with uncertainty after good recovery since late last year.

Unless there is a wedding in the family, consumers are not stepping out to buy jewellery and they prefer standalone stores than venturing to mall-based stores, he said.

Investment demand

The low gold prices have attracted investors and bullion buyers. Gudi Padwa (the new year in Maharashtra) is an auspicious day for Maharashtrians and it is customary to buy gold on this day unless a lockdown shuts retail operations again, he added.

The Covid cases in the country crossed one-lakh mark for first time on Sunday even as the tally in five poll-bound States are yet to join the rally. The Maharasthra government has already imposed partial lockdown and restricted people movement.

Ishu Datwani, Founder, ANMOL, said sales and footfalls at jewellery shops are slowly creeping back to normalcy since Diwali after almost a year after Covid hit the country.

Last year, lot of festive purchases and weddings were postponed due to Covid and this has led to pent up demand. The drop in gold prices is an added incentive and jewellery demand may look up from Gudi Padwa leading up to Akshaya Tritiya.

However, Snehal Choksey, Director, Shobha Shringar Jewellers, said consumers are hesitant to step out for shopping unless absolutely necessary with rising number of cases in the cities and anticipation of lockdown along with fresh restrictions.

“With the gold prices dipping, there are more bookings for the upcoming weddings and online bullion bookings but for Gudi Padwa , in particular, we expect truncated demand or rather lesser number of walk-ins,” said Choksey.

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