As the price of gold soars, millions of Indians face a difficult choice. They simply must buy gold presents during the wedding season, which runs from November through February. But doing so means a financial squeeze. So, Indians are recycling their gold by trading in their older gold jewelry for newer pieces.
Gold was trading at more than $2,000 in early December. In India, though, the price was even higher due to a modest decline in the value of the Indian Rupee against the U.S. dollar in recent months. Gold jewelry prices in India are running at about $720 for 10 grams (about 3/10ths of an ounce) or 60,000 rupees.
Gifting gold, and wearing it, is considered highly auspicious in India, particularly during weddings. So the idea of not giving gold is virtually unthinkable for Indians who have reached the middle class. As a result, recycling is becoming increasingly common. Gold recycling is a $5.3 billion business in India, accounting for 11 percent of India’s gold supply. Trading in one’s gold, though, is a fraught decision as gold jewelry is very sentimental for many Indians and is often viewed as a cherished family heirloom.
Due to the increase in recycling, gold imports to India are expected to moderate in early 2024, according to the India Bullion and Jewellers Association.
India is the world’s second biggest consumer of gold, after China. Households and the country’s religious temples hold a combined 25,000 tons of the precious metal.
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