In times when consumers are feeling the pinch of spiralling prices of essential commodities, the yellow metal has offered some breathing space. The precious metal saw another round of free fall in the domestic markets in the wake of a strengthening dollar and sliding crude prices. Gold London spot prices have also come down to $791 an ounce on Tuesday following a steep drop in the prices of crude oil.
?Sales of bullion including gold and silver, have been unprecedented all over the country even in small centres as the jewellery industry, which usually adopts a wait-and-watch approach, has lapped up the yellow metal,? a local bullion dealer said. There has been a 20% rise in the sales of jewellery, coins and bars in the last few days. ?There has been an acute shortage of gold, following the sudden drop in prices, which led to a rush in demand,? Samir Shah, vice-president, Riddhi Siddhi Bullion Spot Exchange (RSBL), said.
?The festival demand is just picking up and depending on the urgency, banks are charging customers a premium of anywhere between 20-25 cents an ounce for silver. The popular 12-day Ganesh festival has started and in the next two months, the country will celebrate Durga Puja and Diwali, both major Hindu festivals, when demand for gold increases for auspicious reasons,? he said.
Silver turned bearish on lack of buying support from industrial units amid reports of the metal having dipped below $12 an ounce in the global markets . The ?black? gold (crude) was down nearly $40 from its previous record price and is hovering around $104-$106 per barrel- levels. ?Gold prices can have short term support at $775, and any closing below that can take the yellow metal up to $750 per ounce,? an analyst said.