The power of gold

December 17th, 20091:45 pm @

Gold wedding jewellery

India likes its gold, buying up an incredible 800 tonnes of the yellow metal each year – a quarter of the world’s consumption.

A lot of that gold is bought by the Indian government, which purchased 200 tonnes from the International Monetary Fund in October, and is already considering stocking up a little more.

I imagine the government squirrels it away in some kind of Fort Knox-style bunker that’s probably being eyed by two fat blokes, one with a deadly hat and the other called Auric.

But I digress.

Much of the non-government-bought gold makes its way into wedding jewellery, as no self-respecting mother sends her daughter to be married without first showering her in matrimonial necklaces, earrings and other precious accruements. The gold forms a large part of a bride’s financial security and is passed down from generation to generation. The picture above features some of my wife’s wedding jewellery.

Gold sales usually spike late in the year as the Indian wedding season gets into full swing. This year, however, provided a twist in the tale thanks to the country’s astrologers.

After consulting the skies, the nation’s oracles decreed that certain planetary alignments weren’t quite up to scratch and that between early December and March there were no auspicious dates to tie the knot.

As well as producing a rush of weddings in late November that clogged roads and filled reception halls as couples raced to be married on the last few suitable dates of the year, the wedding hiatus had a brief effect on gold prices, which took a breather from their inexorable rise as gold traders contemplated a lack of demand from mothers-in-law-to-be over the new year.

Since then the gold price has resumed its steady rise, but it’s another indication of how traditions and beliefs here can have economic impacts.

It was a similar case earlier in the year when a host of religious festivals coincided earlier than usual and gave car retailers a boost in sales. It’s auspicious to buy new things during festivals and cars are a popular choice.

While India is busy finding water on the Moon, becoming the world’s IT back-office and shrugging off the global economic contagion, it’s economy is in many ways, still influenced by ancient traditions.

Be Sociable, Share!