Demand for the yellow metal is likely to increase sharply by about 25% this festive season with gems and jewellery dealers being exempted from the reporting requirement purview of the Prevention of Money Laundering Act (PMLA).
The recent PMLA requirement of KYC-linked purchases of gold had delayed buying, but the latest notification removing the same will increase the pent up demand for gold jewellery.
This is likely to cause a YoY jump of 25% during the ensuing Diwali festival.
Ease of doing business
The rollback of this order will definitely improve the ease of doing business.
Gold prices were ruling firm at ₹31,363 per 10 grams and silver at ₹40,390 per kg in the national capital as of October 13. In the Mumbai bullion market, gold was at ₹31,315.51 per 10 grams. It was about ₹30,450 during the Diwali season in 2016 and ₹25,450 in 2015.
Under PMLA, every reporting entity is required to maintain a record of all transactions of value exceeding ₹10 lakh, all cross border wire transfers of more than ₹5 lakh and all purchase and sale of immovable property of ₹50 lakh or more.
The festive season that generally starts around Teej in August goes up to Diwali, followed by the wedding season.
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