Srinagar, Jan 03: While the global uncertainties played a crucial role in shaping the dynamics of the Indian gold market, a considerable slump has been witnessed in the gold markets across the country during the year 2023.
Stakeholders believe that the unfolding uncertainties on a global scale has not only influenced the gold prices, but in turn triggered a downfall in the business of gold across India. They revealed that the market saw a significant low post Covid-19 pandemic and the developments in the aftermath.
“Geopolitical crises, economic instability, the prevalent wars in several countries, and the fluctuations in currency values including the changes in interest rates are the factors that can be attributed to the slump caused in gold markets in 2023,” Mushtaq Ahmad who owns a jewelry store at Hari Singh High Street said.
India is one of the largest consumers of gold, however a surge in global prices directly impacts the domestic market, affecting consumers and businesses alike. Moreover economic instability in major economies has also influenced the Indian gold market.
The stakeholders revealed that conversely, higher interest rates may diminish the appeal of gold, impacting its prices worldwide and subsequently affecting the Indian gold market.
“The Covid-19 pandemic is a prime example, causing widespread uncertainty and volatility in financial markets globally. It led to fluctuations in gold prices, impacting India’s gold market as well. The pandemic disrupted supply chains, affecting the import and availability of gold in India, and simultaneously altering consumer behaviors due to economic uncertainties,” Suhaib, who deals with e branded gold ornaments said.
He said that the changes in these policies can influence the flow of gold into the country, affecting prices and availability for consumers and businesses.
The intricate interplay between global events, their impact on gold prices, and India’s heavy reliance on gold imports and consumption create a volatile environment where any global uncertainty resonates significantly within the country’s gold market, affecting consumers, businesses, and investors alike.
“I would say, in Kashmir valley there has been a weaker sentiment towards gold sale and purchase in 2023. It has not been that rewarding. There can be several reasons behind it. Economic instability can also be one of the reasons. The gold prices have gone all time high which is the major reason. The prices have been immensely fluctuating leading to a decline in this business,” Suhaib said.
He said that the global phenomenon had a bigger role. Moreover the post pandemic slump in economic realms was also responsible for the decline.
“Gold market has witnessed a major downfall in 2023 as compared to other years. There are several reasons for that, mostly the changing economic stability and geopolitical developments that directly impact this business.
“The inflation in gold markets has been skyrocketing which resulted in a downfall. The minor fluctuations don’t create that impact however major changes play a crucial role do,” Aalmas Jewelers said.
