Pune: Gold prices surged to a record high of Rs 1.01 lakh per 10g (excluding GST) on Thursday, driven by geopolitical tensions, a weaker rupee and US tariff hikes. The price rise was likely to further dampen sales, with jewellers reporting hardly any new purchases with customers focussing on exchanging old gold or turning to lightweight jewellery instead.

Gold hit a high of 1,00,904 per 10g for 24 carat of 999 purity (excluding GST) before closing at Rs 1,00,704/10g and silver too hit Rs 1,15,250/kg in Thursday's trading session, India Bullion and Jewellers Association Limited data showed.

Saloni Gupta, a resident of Wanowrie, said, "Gold prices are unrealistically high. So, I'm opting to exchange my old jewellery for new pieces instead of buying fresh ones. Buying new gold jewellery just doesn't make financial sense right now."

Kothrud resident Rajkumar Kulkarni, whose daughter is set to tie the knot in Dec, said, "We are only buying daily-wear jewellery for our daughter's wedding. We will buy more elaborate pieces next year when the gold prices potentially stabilise."

Bullion traders expected the gold prices to surge further, given the current geopolitical situation. "The marriage season is going to take a big hit if gold prices continue moving up," Anil Jain, a jeweller at Mumbai's Zaveri Bazaar, said.

Prithviraj Kothari, managing director of RiddhiSiddhi Bullion, said with gold prices soaring to new highs almost daily amid global tensions, buyers were likely to opt for lightweight jewellery this festive season.

Renisha Chainani, head of research at Augmont said though the price rise might temper festive demand, especially for mass-market jewellery, investors might continue to accumulate gold in digital or ETF forms, anticipating further upside. "Jewellers may, however, face margin pressure amid cautious consumer sentiment," Chainani said.

With the festive season kickstarting this month, jewellers are offering some discounts on making charges for gold. "The rates may climb further, so we have investors coming in to buy gold. We are seeing some purchases happening for Rakshabandhan, mostly in the lightweight jewellery segment. We are offering a 25% discount on making charges too," Balasaheb Amrale, owner of Amrale Jewellers on Laxmi Road, said.

Some jewellers like Caratlane are offering 30% off on diamond jewellery too. "As far as the festive season and weddings are concerned in a high-demand Indian market for gold, we are expecting a mixed impact with a minor de-growth in volumes for gold. People are going to shift to lightweight jewellery," Suresh Krishnan, vice-president, sales, PNG Jewellers, said.

Year Avg price of gold/10g (Rs)
2021 Rs 48,720
2022 Rs 52,670
2023 Rs 65,330
2024 Rs 77,913
2025* Rs 1,00,030
(* Till Aug 7)

Courtesy : TOI