Dip in gold prices spurs demand on Akshya Tritiya

New Delhi, May 7 (IANS) "Akshya Tritiya", considered an auspicious day for buying gold in India, saw healthy buying of the yellow metal this year as lower prices increased footfalls in traditional markets like Ahmedabad, Mumbai and Delhi.

Irrespective of market conditions, gold prices normally increases during the auspicious buying period of Akshya Tritiya. However, global developments this year have pushed down the prices, with the precious metal being almost 10 per cent cheaper this year as compared to the same period last year.

"On this day of Akshaya Tritiya, we are seeing healthy double-digit growth as compared to last year. We are looking at healthy gold and diamond jewellery sales in the next few hours till the end of the day's closing," said Sandeep Kulhalli, Sr. Vice President-Retail and Marketing, Tanishq.

Buyers were seen interested in light, fashionable and trendy items, said a jeweller in Ahmedabad. Gold with 24 carrot purity was priced at Rs 31,700 per 10 gram plus GST in Ahmedabad during the afternoon session. Gold with 22 carrot purity traded at Rs 31,100 per 10 gram plus GST.

"The festive sentiment amongst both trade and consumers appears to be stronger this year. A favourable price offers a good seasonal opportunity for wedding purchases, which underpin Indian jewellery demand. Various trade offers and promotions point towards an increase in demand for both jewellery as well as investment products like coins and bars," said Somasundaram P.R., Managing Director, India, World Gold Council.

"Although a nascent trend, digital gold buying platforms are quite upbeat at this time as they continue to grow at a fast rate, offering consumers the option of purchasing pure gold for as little as one rupee on their smartphone and at their convenience. In spite of the elections, all the indicators point towards a good buying season this Akshaya Tritiya in comparison to the previous year."

By late afternoon, at Multi Commodity Exchange (MCX), gold contract expiring in June was at Rs 31,562 per 10 gram, one rupee down from the last closing. In the international market, June expiring contract of gold on the comex was at $1,281.15 per ounce, $2.65 dollar per ounce down from the last session.

According to analysts, prices of the yellow metal are poised to rally amid rising uncertainties as the US President Donald Trump, despite repeated claims by the White House that trade talks with Beijing were progressing, said on Twitter last Sunday that he would increase tariffs on $200 billion of Chinese goods from 10 per cent to 25 per cent.