Demand for gold is expected to increase following a downward trend in prices during the forthcoming festive season, a top industry official said.
"Gold demand will go up during the forthcoming festive season. The downward trend in gold prices may also help increase demand," Bombay Bullion Association (BBA) President Suresh Hundia told PTI here.
The demand for gold revived as prices fell sharply in the last one month from an all-time high of Rs 13,764 per 10 grams as on July 15 to Rs 11,415 on September 13.
The fall in prices bring relief to local consumers in the festival season. Demand has improved significantly ahead of festivals and is expected to continue.
At the beginning of the month, traders and jewellers alike anticipated a sudden buying among the consumers, owing to the festive season ahead and also the fall in gold prices. But demand in the early stage of the month did not increase as expected.
Demand for gold in the Indian market picked up only after the second week, National Commodity Exchange of India (NCDEX) Economist Manasee S Gokhale said.
Gold price may hover between Rs 10,800 to Rs 11,800 by Diwali, Hundia said adding that in view of rising demand, import of gold has improved to 98 tonne in August 2008 as against 69 tonne in August 2007.