Gold jewellers have started feeling the heat of rising gold prices. Many of them have started facing a cash crunch and some of them are rushing to financiers to meet their need for cash. Some small to medium jewellers have even closed their shutters under various pretexts just to escape the heat.
This has also led to hedging in the international markets through unofficial channels.
It is expected that if the spiral in gold prices continues for the next few weeks, even the largest gold dealers will run out of holding capacity. This, top dealers said, would create a severe gold and financial crisis in the country since there is no outlet for exporting or channelling the tons of gold flooding the market in the form of scrap or jewellery.
While large jewellery houses are managing the situation fairly well by virtue of their sheer size and long standing in the market, small to medium jewellers are resorting to either only accepting jewellery sold by them or closing the shops under the pretext of marriage or death in families.
