India gold and silver prices recover

By

Isabelle Crossley

Published
Jan 12, 2018

On January 11, gold and silver prices appeared to have recovered from their slump on the Indian market due to both overseas and domestic demand.

Gold prices rose by 145 rupees to 30,620 rupees per ten grams and silver prices rose by 180 rupees to 39,680 rupees per one kilogram. This has been attributed to a strong overseas market as well as increased domestic demand for gold and increased industrial offtake for silver.

As the US dollar has weakened, many are reverting back to gold for investments, and so the price of gold has also risen by 0.06 cents on the global market. The next Indian wedding season is fast approaching and buying by both jewellers and shoppers ahead of this has also helped to boost sales.

India’s jewellery market has had a rocky past year which began with demonetisation in the winter or 2016/ 2017. The introduction of new tax rates under the GST in July caused a further dip in sales with shoppers fearing increased tax rates. However, the government is also taking steps to renew shoppers’ trust in the Indian jewellery market and is in the process of rolling out compulsory hallmarking for gold jewellery.

However, whilst this is good news for consumers and the organised segment of the market (in which hallmarking is already the norm), it has been met with trepidation from smaller jewellers in the unorganised section of the market. The year 2018 promises to be one that sees more organisation in the Indian jewellery market, which could indeed boost sales, but how smaller retailers will weather this storm remains to be seen.