With COVID cases on the upswing once again, gold purchase by jewellers has dropped by 25% in the past one week as many weddings are anticipated to be postponed.

Lower local bullion buying is likely to bring down the import of gold in January to 55-60 tonnes from 86 tonnes in December, according to industry estimates. But prices are expected to move up amid increasing COVID cases globally, as gold is seen as a safe bet in times of uncertainty.

India’s wedding season, which begins on January 15 and continues right up to July, is typically a strong period for jewellery sales. However, with several states announcing night and weekend curfews, and restricting the number of guests at events, jewellers fear that marriages will be postponed again.

There has been a dip in bullion buying by almost 25% since the cases started increasing over the last one week. Customer footfall at Zaveri Bazar, the largest gold market in the country, has reduced by 20%-25%.

While demand for gold may remain muted for a while till the COVID situation comes under control, prices are expected to move up in the short term.