Domestic jewelry prices inconsistent with global market

04 Sep '08

2 min read

With a soaring rise in international price for gold, domestic traders had also hiked the prices of the yellow metal and jewelry made from it, to keep pace with global market.

However, recently, there was a decline in prices of gold jewelry in the international market, but surprisingly; local markets did not undergo a similar change or revision of rates. Jewelers are still selling ornaments at a rate much higher than those prevalent in the global market.

Although the Bangladesh Jewelry Association (BJA) did bring about a drop in prices, the decline was marginal and nearly negligible when compared to the fall witnessed in the international market.

While the association agreed that decline in gold prices was necessary, it remained sturdy on the point that changes could not have been made overnight because the country's business interests needs to be attended first.

The entity reasoned out stating that if prices were reduced abruptly, customers who already placed orders when prices were high would definitely cancel their orders thereby affecting jewelry business in Bangladesh and bringing heavy losses to the sector.

As a matter of fact gold supply in the domestic market comes not from the international market but from the recycling of local reserves like people selling old jewelery in lieu of new. Sop, if local prices of gold are kept lower than the global rates, an enormous bulk of the precious metal would be sourced out from the country.

Nonetheless the association has promised to pull down the prices further by around Tk1,000 per bhori soon. But traders hope that with a gradual decline in prices, business would not be affected negatively.

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