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Gold high bad news for traders

india Updated: Jan 31, 2009 14:31 IST
Manish Pachouly
Manish Pachouly
Hindustan Times
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Gold hit an all-time high of Rs 14,700 per 10 gm on Friday.

However, with no actual buyers, jewellers in Mumbai have been forced to sell the yellow metal at much lower rates. With gold prices skyrocketing, there was a huge gap on Friday between the prices quoted by banks, the multi-commodity exchange (MCX) and retail jewellers.

While gold rallied around Rs 14,400 per 10 gm on the MCX, bank wholesale rates for jewellers touched Rs 14,700 per 10 gm, later dipping to Rs 14,570.

Jewellers, on the other hand, maintained a much lower rate of Rs 14,100 per 10 gm and sold only old stock, bought at much lower rates.

Traders said, generally, gold prices quoted by retail jewellers were a little higher than the price on the MCX. But on Friday, the trend was just the opposite.

Dinesh Sanghvi of Raksha Bullion said jewellers were forced to sell gold for less as there was no retail buying.
Kumar Jain, vice-president of Mumbai Jewellers’ Association, who also owns a jewellery store in South Mumbai, said that he did not buy any gold on Friday, owing to the high price.

Jain sold gold jewellery at Rs 14,100, but only old stock. “I had bought gold on Thursday at Rs 13,760 per 10 gm, which was that day’s closing price,” said Jain.