Jewellers optimistic as silver prices surge

PUNE: Even as silver prices climb to Rs 57,700 per kg on the backdrop of a weakening rupee from a low of Rs 53,000 a fortnight ago, jewellers and investors say the outlook on the metal is bullish and will easily cross an all-time high of Rs 75,000 a kg by Diwali this year.
City jeweller Shailesh Ranka said: "There had been an unrealistic price rise on the days immediately succeeding the Good Friday weekend in April this year.Plus, the economic crisis in Europe had people converting their dollar reserves into gold and silver. So there was bound to be a correction. But we expect it to cross Rs 75,000 to 80,000 per kg by Diwali as fundamentally it is a sound investment option, backed by strong industrial demand."
Saurabh Gadgil, another jeweller, said: "Silver has reached Rs 57,700 given the fluctuation in the rupee-dollar trade. While the rupee was Rs 43.40 against the dollar just a month ago, today it is around Rs 45.50. It had come down to Rs 53,000 due to the impending correction following the steep rally of Rs 75,000 per kg. However, long term, it continues to be bullish. Silver, as a metal is scarce, versatile and greatly in demand for industrial uses. Like gold, silver is a natural commodity and a safe haven at all times. Silver can be easily purified, hall-marked, verified and encashed at the counter. I would expect it to reach Rs 80,000 per kg by Diwali."
Chartered accountant Sachin Gujar backs silver as an 'excellent' investment option. "Never mind the short-term fluctuations. The outlook on silver is globally bullish - within the next two years, it may well cross Rs 1,50,000 per kg - thereby outperforming the real estate market on returns on investment," he said.
Businessman H Shetty said: "Silver is a long term investment and despite the sharp fluctuations after the rally post-Good Friday, I plan to stay invested. It is a better performer than gold."
A salesperson at a leading jewellery store said: "Silver utensils and puja items have always been traditionally bought during the wedding season - and despite the escalating prizes, it does not stop people. As a presentation item, however, people choose to gift silver only to the most premium clients and associates."