Gold gets boost on auspicious occasion

Despite the World Gold Council (WGC) not hyping up Pushya Nakshatra, the two-day auspicious period to own gold, the yellow metal sales rose 50 per cent across the country.

According to an estimate, the daily average normal gold sales in May was around 500 kgs, which rose to 750 kgs on Thursday due to the celebration of the festival which is considered good for buying gold and is celebrated in Gujarat and south Indian states.

Sales have risen 40-50 per cent, confirmed Bhargav Vaidya, an analyst with B N Vaidya & Associates, a Mumbai-based precious metals trading firm.

However, consumers are awaiting a correction of Rs 200-250 per kg. If price cools a bit, consumer interest will resume for gold as a safe haven. Presently, gold consumers are hesitant to pump fresh money into this asset class, said Ketan Shroff of Pushpak Bullions, a Mumbai-based precious metals trading firm.

Shroff, however, confirmed that the consumers’ interest rose on Thursday. But, the average sales being very low, the overall impact was minimal, Shroff added.

Pushya Nakshatra falls on Thursday and therefore, it is called Guru Pushya Nakshatra which is considered an auspicious period for Hindus for owning gold. The celebrations will start early Thursday and will run through Friday evening.

Ajay Mitra, MD — Indian sub-continent of WGC, said, “We did not build any hype over the occasion like Akshaya Tritiya. Only our partners took some initiatives like waiving making charges and increasing consumer interest in Indian mythology.”

Citing an example of Tanishq, Mitra said the organisation has introduced a “Gita” pendant which shows the consumer sentiment is changing towards ancient Indian cultures.

The rise in sales could be store-driven on the occasion compared to the other big auspicious occasions which are hype-driven.

Suresh Hundia, president of Bombay Bullion Association, however, sees no major change in demand though the being price is too high. On Thursday, consumers postpone even need-based buying as they expect the price to fall in near future.

Meanwhile, gold prices in Mumbai rose Rs 50 for the standard (.995) and pure (.999) varieties to close at Rs 14,665 per 10 gm and Rs 14,730 per 10 gm respectively.

On MCX, gold contract for delivery in June slipped marginally by 0.19 per cent to trade at Rs 14,603 per 10 gm while the far month contract (December ‘09) was positive, with price rising 0.41 per cent, to Rs 1,4737 per 10 gm in early evening trade.