Demand for the precious metal usually spikes towards the end of the year in India, as buying gold for weddings and major festivals such as Diwali and Dussehra is considered auspicious.
However, the yellow metal has lost its lustre so far this year. India's gold demand in the first three quarters fell as coronavirus-triggered lockdowns hit jewellery demand.
Overall gold consumption fell as well, however, demand for coins and bars, known as investment demand, jumped 51 percent in the third quarter as rising prices attracted investors.
To take this news forward, Suvanker Sen, CEO of Senco Gold and Diamonds and Adrian Ash, head of research for BullionVault, is in conversation with CNBC-TV18’s Manisha Gupta.
Sen said, "It is a very good scene in stores after a lot of apprehensions and very limited footfalls that we have been getting in the past. We have seen that the festive season is drawing customers to the stores. It is like a revenge marketing that is happening and women’s are trying to go out and buy some piece of jewellery. There has been a phenomenal increase in prices, but in spite of that customers have believed and once again gold has proved that in crisis gold is one of the best products to have and it performs so well."
Ash said, "I think this is a continued trend that central banks everywhere are trying to juice the economy with weaker interest rates, more quantitative easing, that devalues currency over the longer term and that makes gold typically a wise investment for the long terms. So from here, I do not see a lot of big change in the big macro picture. I think the underlying picture in the macroeconomy remains - big government deficits, lots of central bank easing and probably continued support for gold prices long term."
Watch this video for more.
(Edited by : Jomy Pullokaran)