Wednesday, 19th January 2005 (4562 views)

Despite rising gold prices, Indian demand for gold jewellery in the current wedding season is up five per cent.

The wedding season accounts for at least 60 per cent of the 600 tonnes of gold sold in the country each year. Jewellers say the rise in demand is mainly due to gold's strong investment value.

Traditionally, parents give gold jewellery to Indian brides to provide financial security, and with the strong performance of the metal, this has made the jewellery a better buy.

"The reason people are buying gold in India is for its value as an investment. The orders for the current wedding season are good," said PK Jain, a jeweller based in Mumbai.

Reuters reported that around 14,000 weddings took place on the first day of the wedding season in November. The high demand is a comeback from disappointing sales last year where customers became sceptical of the higher prices.

The continued strong performance, which has seen the price of gold rise since 2001, has reinstated consumer confidence in gold.

 

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