THIRUVANANTHAPURAM: The bullion market that witnessed a mixed response in the Deepvali season across the country brought some cheers in Kerala with the business registering a marginal growth compared to Onam which nearly got washed away in the state due to the flood havoc.
Abdul Nazer, All Kerala Gold and Silver Merchants Association treasurer, told Express the market witnessed a 10-12 per cent rise in the trade with household purchase limping to normalcy in the state.
The gold prices which dropped by 10 to 2,955 per gm in bullion trading in the state has seen a drop of 210 to 32,400 per 10 gm in the national bullion market on Wednesday against the predicted gold prices of 34,000 per 10 gm level during Deepavali mainly on the back of the falling rupee.
In Kerala, Deepavali is not a big trading season when compared to Onam or the Christmas market. The state used to witness a sale of around 80 tonne per year and the Onam, Christmas and the wedding season contribute the bulk of the total trade. Further, there has been a 30-35 per cent dip in the market for the last two years owing to demonetisation and other reforms initiated by the Centre.
But what makes this festival season a favourable sign for the traders in Kerala is the market has seen a six to 10 per cent increase in the sale when compared to the general festival sale. This shows the people have realised investing bullion is more safer than investing on land or share market especially in the backdrop of the flood, said an office-bearer of the Jewellery Manufacturers’ Association.
He, however, said when considering the growth and performance of the bullion market in Kerala over the years, the market is yet to reach a feverish pitch. For an average shop in Kerala, the business has dropped by 30-35 per cent when compared to the business volume in the pre-demonetisation era. If one kg gold was sold before the pre-demonetisation era, it has fallen to 600 gm after the demonetisation.
An increase in 6-10 per cent rise in general sale indicates the market is limping to the normal pace. Kerala accounts for about 10.5 per cent of the country’s gold jewellery demand.