Though it may have lost some lustre due to the receding global risk perception, gold is fast reaching a “Buying Temptation Zone” in India, says an Assocham paper.

Buying Temptation Zone (BTZ) is ₹25,000 or a shade below per 10 grams in the spot market, the paper said, taking note of the fact that in the futures market prices are already below this level for August delivery.

“The enquiries among the consumers, mostly women, are increasing. As we near the festival and wedding seasons in the next few months, the demand will pick up, boosting overall sentiment,” the paper said.

A sharp reduction in international prices below $1,100 per troy ounce was triggered by a resolution to the Greek financial crisis and stability returning in the Chinese stock market. The paper, however, said that India, along with China, among the largest two consumers of gold, can influence global prices.

Buying spree Commenting on the scenario, Assocham Secretary General DS Rawat said: “When it comes to gold, some kind of conventional wisdom is seen whereby it is considered to be the best safe haven even among central bankers all over the world. So, it would be premature to write off gold, even though in India a debate is underway on whether gold is productive as an investment class.”

According to the paper, “One of the factors, hitting the domestic demand for jewellery is the requirement of PAN card for purchases above ₹1 lakh. This raises apprehensions among the buyers as if they are under a strong watch”.

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