Diwali may bring little cheer to jewellers
India’s festival of lights is bringing little cheer to jewellers in the world’s second-biggest gold consumer market. With less than a month to go before Diwali, a period when gold purchases typically peak, jewellers are lining up promotions to get buyers through the door as a rally in prices coincides with a collapse in consumer demand for everything, from 7-cent cookies to cars. Gold has soared in 2019, hitting a six-year high in dollar terms, as investors fret about the impact of the trade war, central banks cut rates and exchange-traded fund holdings surge. In India, where prices hit a record in September, the rally comes as the country’s growth slows, unemployment rises and a crisis of confidence engulfs the banking system. Its imports fell for a third month in September to the lowest in more than three years as jewellers cut purchases. Gold futures in Mumbai touched an all-time high of 39,885 rupees ($561) per 10 gram in early September and while prices have come off about 4 pre cent since that peak, they’re still more than 20 per cent higher than last year. - Bloomberg
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