Gold, silver surge fades festive shine in Chennai
Deepavali’s sparkle has dimmed for Chennai jewellers, as gold nears Rs 12,500 per gram and silver crosses the Rs 200 mark
Gold and silver
CHENNAI: Gold and silver prices have shot up sharply ahead of Deepavali, dampening the festive mood among jewellers who now fear sales could plunge by as much as 25% compared to last year.
As of October 14, one gram of 22-carat gold in Chennai costs Rs 11,825 — translating to Rs 94,600 for eight grams — while silver has breached the Rs 200 mark for the first time, now priced at Rs 206 per gram. Traders expect both metals to climb further as global demand stays strong.
“Gold is likely to touch Rs 12,500 per gram during Deepavali, with the price of a sovereign crossing Rs 1 lakh,” said S Santha Kumar, secretary of the Madras Jewellers and Diamond Traders' Association, speaking to DT Next. “Silver could even reach Rs 250 per gram,” he added.
Traditionally, the festival of lights sparks a buying frenzy for jewellery, but this year’s bullion surge has left customers hesitant. “We’re seeing a clear 20–25% fall in sales compared to last year. Regular buyers are staying away, wary of these high levels,” Shanthakumar noted.
According to association data, silver prices have nearly doubled this year — from Rs 97 per gram on January 1 to Rs 161 on October 1, then to Rs 190 by October 12, before crossing Rs 200 now. Gold, too, has rallied from below Rs 10,000 per gram earlier this year to over Rs 11,800 in mid-October.
Experts say silver’s rally has been driven by its rising use in solar panels and electric vehicles, giving it a particularly bullish outlook.
Despite the subdued sentiment, jewellers are holding out hope for brisk activity in smaller purchases and lightweight ornaments, as customers adapt to the new price realities.
So far this year, in the national capital, gold prices have increased by Rs 51,850 or 65.67% from Rs 78,950 per 10 grams on December 31, 2024.
Traders attribute the sharp rise in bullion prices to sustained demand from jewellers and retailers, along with a weaker rupee that slipped 12 paise to revisit its all-time low of 88.80 against the US dollar on Tuesday.