The festival season between Diwali and Christmas is yet to come and the offtake is expected to go up even further.

Supply of gold has eased up this year with the gold policy removing most of the obstacles faced by the industry. With the sourcing easing up nationally as well as internationally, the prices of the yellow metal have firmed up, Nandagopal said.

The policy formulation has almost put an end to the smuggled gold trade, with the few offense mainly coming from individuals who bring in gold from the middle-east and sell it locally.

Internationally demand is said to be fairly strong with the supply being steady. While the current week has seen some fluctuations in the international pricing ofgold, in the domestic market the rates have remained steady.

Says V Vijeyendran of Vummudi Ethiraj and Sons, "Prices have been steady for quite some time. We are expecting the rates to increase marginally in the festival season, but there are no drastic changes on the anvil."

According to statistics available with the export promotion council,bullion has earned a net $839.48 million, up by 12 per cent since last year. The trend is likely to continue throughout the year. As far as the southern region is concerned, exports jumped from Rs 16 crore in April 1997 to Rs 32 crore in March 1998.