Buyers in dilemma as gold rates soar

The price of the yellow metal touched an all-time high of Rs 1,616 per gram on Tuesday

There is fast buying on the part of those who are pessimistic about rates coming down in the near future while some are frantically investing in the yellow metal feeling that it is bound to scale even higher.

Those making a beeline to purchase now are clearly those who view it as a great investment for the future, says Venkatesh Babu, vice-president of The Jewellers Association, based in Chickpet.

Surge in price anticipated
“Customers who have purchased on Tuesday and the last couple of days from various jewellers have gone in for one kilo or half-a-kilo anticipating a surge in price in the future.” They are clearly buying it with the idea of reaping profits in future, he added.

Kumar, an agriculturist, from Mysore is one such investor. He was purchasing necklaces totalling 200 grams for his wife from ‘Chetana Jewellers’.  “I have spent Rs 1,88,000 to buy them today. Had I done it yesterday, it would have cost me just Rs 1,61,000,” he sighs. These would definitely be savings for our family in future, he says prophesying that the price will climb up even further higher on Wednesday.
Regional Manager at Kirtilal Jewellers at Richmond Road, Mr Sreepathy Rao feels that if the skyward movement of prices continue, it will be a clear dampener during Diwali when many opt to buy gold as a sentiment.

“Ever since Akshaya Tritya, jewellery sales was really picking up. But the surge this week is quite worrying,” he opines. Those who planned to buy, say 50 grams, for a particular occasion, are now buying only 25 grams, he adds.
Another jeweller, requesting anonymity feels that the rate per gram will touch Rs 1,700 shortly.

Whatever it is, there will be no dearth of customers, he feels. “The only difference will be that customers will reduce the grams of gold they purchase.”
Babu also holds out this note of caution to those rushing to invest now. “A market correction is long-due and could happen any time. So, those investing need to be a little cautious too.”