Thursday, October 8, 2009

Is Ben Bernanke Ruining Indian Weddings?

Not only is Ben Bernanke destroying American savers, it appears now he is now helping to ruin prospects for Indian weddings. Oh Ben... so many unintended consequences of your actions - now you crush a nation of young Indian female's dreams too.

Via Bloomberg
  • Record gold prices will “ruin” festive-season demand in India, the world’s biggest consumer, the nation’s largest jewelry producer and exporter said.
  • There’s going to be a big drop in jewelry demand if the current price sustains,” said Rajesh Mehta, chairman of Rajesh Exports Ltd. from Bangalore. “The entire festive season demand will be ruined.”
  • India’s bullion imports fell for a fifth month in September to 50 tons from 54 tons a year ago, as high prices cooled demand for jewelry.
  • Global prices must drop at least 7 percent to lure households in the country, where women are the biggest users of gold, to buy rings, chains and necklaces, Mehta said. “Unless prices drop back to $960-970 levels, Indian buyers are unlikely to make big purchases,” Mehta said.
  • “Sales have certainly declined today...Rising prices have put off buyers and scrap sellers are waiting for prices to rise further,” said Arora, who is also the vice president of the Bombay Bullion Association.
  • “The only consolation is the gain in the rupee, which has cushioned the impact somewhat for Indian buyers,” said Mehta.
  • “Days of gold at $900 an ounce may not be seen again at all,” Hayagriv said. “Gold has been undervalued and there are no two ways about its potential to move higher.”
  • India’s gold imports this year may decline to 300-350 tons from 450 tons last year.
  • Sales typically reach their highest point during the Hindu festival of Diwali, which falls on Oct. 17 this year, and the wedding season that follows.
[Sep 29, 2009: NYT - Out from India's Alleys, Gold Loans Gain Respect]

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