Thursday, 2nd November 2006 (3884 views)

Due to the Diwali festival recently drawing to a close in India, dealers and traders in the country are reporting a decrease in gold demand.

However, demand was predicted to pick up by Chintamani Kaigaonkar, a jeweller from Dadar, as the wedding season is about to begin, prompting greater need for gold.

Allied to this, Hindu shoppers who traditionally wait for auspicious days before purchasing gold will see these occurring in December and therefore potentially provide a boost for gold sales.

Reuters reported Afshin Nabavi, senior vice president at Geneva's MKS Finance SA, as stating: "Demand is down as prices are extremely unstable and volatile. I think it will revive, but traders wait for stability before coming into the market."

The wedding season in India runs from December to May and gold makes for a popular dowry as well as wedding gift.

Customers in India are now thought to be waiting to purchase gold with Nilesh Shah, partner at Shubham Jewels in Mumbai, telling Reuters: "There is still time to wait for prices to fall as the weddings are starting next month."

 

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