7th Pay Commission will Push Gold to Rs.35,000 – India Bullion and Jewellers Association
7th Pay Commission will Push Gold to Rs.35,000 – 7th Pay Commission payout to central government employees, which is expected to begin from September 1, 2016, will also give a boost to gold.
The coming few months dotted with festivals and 7th pay commission can provide a further boost to gold prices in India. Experts believe that festive demand can push gold prices to Rs 34,000-35,000 per 10 grams by the end of the current year.
“Gold prices are expected to remain firm in the coming months. We expect strong demand for jewellery during the upcoming festive season which would include Ganapthi and Dusshera festivals. The marriage season around December should give a further push. Gold should test Rs 34,000-35,000 in the next 4-5 months,” Saurabh Gadgil, CMD, PNG Jewellers and Director, India Bullion and Jewellers’ Association told FeMoney.
He said that the 7th Pay Commission payout to central government employees, which is expected to begin from September 1, 2016, will also give a boost to gold. “The 7th Pay Commission payout will certainly lead to higher gold sales. We are already seeing some demand from government employees who are coming and making purchases on anticipation of higher salaries due to 7th pay commission,” Gadgil CMD, PNG Jewellers and Director, India Bullion and Jewellers’ Association told.
Gold, which started year at around Rs 25,000 level closed at Rs 31,720 on August 19 according to prices of Indian Bullion and Jewellers Association quotes, which works out to gains of around 27 per cent year to date.
V P Nandakumar, MD & CEO, Manappuram Finance Limited agrees that 7th Pay Commission payout will boost gold sales. “A part of the payout can reasonably be expected to find its way into gold purchases,” he said.