Gold tops Rs 1.10 lakh per 10 gm: Festive demand shifts despite record prices - What jewellers expect?

Gold hit a new record on Tuesday, crossing Rs 1.10 lakh per 10 grams just days before India's peak festive season, leaving jewellers cautious about how demand will shape up.According to the India Bullion & Jewellers Association (IBJA), gold is currently retailing at Rs 1,10,540 per 10 gm in the physical market. With 3% GST, consumers are paying Rs 1,13,856 for the same quantity.Jewellers expect that most sales this season will be driven by customers exchanging old gold for new designer jewellery. "We are expecting the old gold exchange to surge to 45% this festive season as compared to 20-25% last year," Saurabh Gadgil, managing director of PNG Jewellers told ET."Gold volume may shrink by up to 15% during the upcoming festive season because of the price rise but value-wise it is expected to go up by 25-30% as prices have appreciated," he added.Compared to last year, when gold hovered around Rs 80,000 per 10 gm with GST, prices have jumped 42% year-on-year, strengthening gold’s position as a preferred investment worldwide.Surendra Mehta, national secretary of IBJA, said buyers have accepted that prices are unlikely to drop below Rs 1 lakh anytime soon. "Investment demand for gold is also rising as there is no sign of gold to cool off any time soon. The market is now awaiting gold to cross $4,000 per troy ounce mark," Mehta added.Globally, gold has already surged to an all-time high, touching $3,670 per troy ounce.