This Ganesh Chaturthi, Mumbaikars have purchased 55 kg of gold—15 kg more than last year—to offer to Ganpati, driven by positive market sentiment following the reduction in the gold import duty.

The increase in gold offerings, including necklaces, padukas, and modaks, indicates a promising trend for festive gold buying across other regions of the country. Ganesh Chaturthi, which began on Saturday, marks the beginning of the festive season, followed by a wedding season extending until February next year.

Although gold purchases specifically for Ganpati are not typically observed, there has been a notable rise in gold bought for personal use over the weekend, as many considered it an auspicious time. Jewellery items such as necklaces, bangles, and pendants weighing 10-25 grams have been particularly popular.

Jewellery manufacturers have reported a significant rise in order bookings from retailers preparing for the upcoming festive and wedding season, which will continue through December.

The reduction of the gold import duty to 6% from 15% in this year’s budget has positively impacted the domestic gold market. Trade officials expect these policy changes to increase gold demand by 50 tonnes or more in the second half of 2024 compared to last year. The World Gold Council (WGC) has revised its India demand target for the current year to 850 tonnes, up from 750 tonnes.

On Monday, gold was trading at Rs 71,192 per 10 grams, down by Rs 2,808 from the peak of Rs 74,000 on July 13. Internationally, gold prices dipped as the dollar strengthened, with spot gold falling 0.2% to $2,491.11 per ounce. Investors are closely watching this week’s US inflation data to gauge potential Federal Reserve interest rate cuts.

Source: Economic Times