VIJAYAWADA: While the middle class and lower middle class customers are thinking twice before buying gold in view of increasing prices, people in the upper stratum of the society, however, continue to purchase as usual.

Sellers say that gold sales have come down significantly in the last week and the fall in business is in the range of 40 per cent to 60 per cent.

Sales fluctuating

The soaring prices of bullion have given rise to a new trend in the city. For the first time in 25 years, people have begun thinking in terms of making investments in gold and jewellery. The sale of gold biscuits (each 100 grams) has witnessed rise and fall in the last 10 days.

Gold merchants say that the business loss caused by the increased prices has been balanced to some extent due to arrival of investors on the scene. It may be too early to say that the investment tendencies in gold will continue. But if the prices keep fluctuating, it is a sure-shot lure for those who are ready to take a risk.

Gold merchants themselves are making higher investments in gold purchases with a view to take benefit out of the price fluctuations. Each biscuit costs a little over Rs. 1 lakh now.

The price was Rs. 9,000 for 10 grams nearly 10 days ago and it increased steadily. The price was hovering around Rs. 10,000 for 10 grams in the last couple of days. On Tuesday, the price of gold was Rs. 10,080 for 10 grams.

Anjaneya Jewellery proprietor Vadlamudi Venkatrao said that the confidence that gold prices would keep increasing, was giving rise to the new investment trend.

`Trade not fetching'

He said that the middle class customers were not buying jewellery unless they were compelled by circumstances like marriages and important functions. This would create more problems to the small shops owners in the coming days, as they were already struggling due to lack of good returns. "Unless we do gold business in higher volumes, the trade is not fetching these days. Competition has increased manifold," Mr. Venkatrao added.

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