Even tradition can’t withstand bullion’s lofty ascent
TAVIA GRANT
From Saturday's Globe and Mail
Published
Last updated
Barry Randhawa holds a glowing 22-karat gold bangle, tilted to show the inside. It’s concave, something he calls “negative space,” a subtle effort by the manufacturer to make it lighter and keep the price down.
It still costs about $500. Skyrocketing prices, combined with economic worries and changing tastes, are driving consumers away from traditional gold ornaments. Many jewellers in Canada’s South Asian community say business has been unusually slow as some buyers delay purchases in the hope that prices will eventually ease.
“November and December have been dead,” said Mr. Randhawa, who runs Randhawa Jewellers, a 20-year-old business, with his brother, father and two uncles in northwest Toronto.
He is now offering necklaces with lighter chains, and hollowed-out bangles. His store is surrounded by 16 other jewellers in strip malls at the intersection of Islington Avenue and Albion Road, and competition is ferocious.
Across the road, his competitor at New Maharani Jewellers echoes his observations. “Business is slow due to the high price of gold,” owner Sanjeev Bassi says. “No one knows, even the economists don’t know, when the prices will come down.”
Gold has for centuries been a central purchase for many South Asians, an insurance policy against life’s upheavals and an heirloom passed down through generations. Ornaments, both intricate and chunky, are a common wedding gift, and many save for decades to ensure they can afford to present jewellery. For all but the poorest, gold is an inherent part of daily wear.
But that tradition is changing: Price-conscious consumers have watched the price of bullion surge. Gold traded around $300 (U.S.) an ounce 10 years ago - it is now close to $1,400. The price has climbed 27 per cent this year alone, and it’s affecting retailers and consumers alike.
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