Jewellers in Mumbai lost business worth Rs 1,200 crore in the terrorist bloodbath that engulfed the metropolis from Wednesday to Saturday, a top industry official said.
“Jewellers lost business worth Rs 1,200 crore following the business shutdown in Mumbai due to the terror attacks,” Bombay Bullion Association (BBA), President, Suresh Hundia said. The average business per day is Rs 300-400 crore, he said.
Jewellers, who produce one tonne of gold items a day, are facing tough times as demand has fallen sharply due to the high prices.
“Now the terror attack has hit them badly. It will take 10-15 days to recover,” Hundia said.
It is some relief that the terror attack on Mumbai has not impacted gold prices in the local market. Prices have not been influenced by the attacks as the metal usually shows a downward movement only when faced with larger international crises and possible disruptions to oil supplies, analyst Amit Zaveri, said.
Meanwhile, gold rallied to a five-week high in the Mumbai bullion market last week at Rs 13,185 per 10 gm on fresh support.
In the local market, standard gold (99.5 purity) opened lower at Rs 12,870 but recovered afterwards to end at Rs 13,185 as against the last weekend’s close of Rs 12,995, showing a smart gain of Rs 190 per 10 gm.
In the futures market on the MCX, gold April 2009 contract was up by 0.36 per cent to Rs 13,172 per 10 gm and gold December 2008 contract by 0.66 per cent to Rs 13,111 per 10 gm.
Gold guinea November 08 contract moved up by 3.95 per cent to Rs 10,509 per 8 gm.
Gold prices also witnessed a firm trend in the international market.
Gold headed for its biggest monthly advance since 1999 in London as a weaker dollar increased the appeal of the yellow metal as a hedge against further declines in the US currency, analysts said.
Encouraging report from the World Gold Council (WGC) and safety concerns on posibility of Citigroup’s demise could have been the catalyst behind this huge rally. Gold demand rose 18 per cent in the third quarter, a broking firm Sharekhan said quoting a World Gold Council report.
As per the World Gold Council, dollar demand for gold reached an all-time quarterly record of $32 billion in the third-quarter of 2008 as investors around the world sought refuge from the global financial meltdown and jewellery buyers returned to the market in droves on a lower gold price.
This figure was 45 per cent higher than the previous record in the second quarter of 2008.
Tonnage demand was also 18 per cent higher than a year earlier. Identifiable investment demand, which incorporates demand for gold through exchange traded funds (ETFs) and bars and coins, was the biggest contributor to the overall demand during the quarter, up to $10.7 billion (382 tonne), double the year-earlier levels, according to Gold Demand Trends, released by the WGC recently.
The figures, compiled independently for the WGC by GFMS, shows that the retail investment demand rose by 121 per cent to 232 tonnes in Q3, with strong bar and coin buying reported in Swiss, German and the US markets.
