ICRA Foresees Retail Demand Recovery for Gold Jewellery

SEATTLE (Scrap Monster): The ratings agency ICRA foresees demand recovery for gold jewellery retail industry in India during the second half of FY21, primarily driven by increased number of occasions such as festivals, weddings, etc. It must be noted that the demand had recorded notable decline by almost 64% in H1 FY21.

The ICRA survey conducted among rated gold jewellery retailers in the country revealed that there has been a steady improvement in footfall since the gradual opening of the stores after lockdowns. However, footfall has not yet reached prior year levels. The rise in rural income on account of good monsoon, gold’s rising appeal as an asset class and anticipated rally in gold prices in future are likely to support retail sales during the next few months, ICRA noted.

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Although various product categories have witnessed enhanced consumers’ interest in online shopping, customers prefer to buy retail jewellery from the bricks-and-mortars shops, as they still wish to see designs in person.

According to retailers, the gold prices are expected to remain at elevated levels in the near future. The prices are likely to range between $1,900 and $2,100 per ounce over the next six-month period.