Gold buying has been slow as jewellers and consumers grapple with the new nationwide goods and services tax, which replaced a variety of state duties. The government also brought the jewellery industry under the Prevention of Money-Laundering Act, which increased compliance requirements.
In 2016, demand slumped to a seven-year low because of a cash shortage after the government withdrew high-denomination notes to curb the black market.
Sellers and buyers are confused as to how things will roll out in the next two to three months. We have too many issues with the money laundering act, where they have included jewellery, and then you have the GST.
“The next six months will be very quiet.”
Stockpiles in local markets remain high, and imports will slow from this month after surging in the first half of the year.