Chennai: Gold prices are likely to come down this week as the dollar is firming up and oil prices are going down, according to traders.
"In the coming week we expect gold prices to go down by Rs.25 per gram as the US dollar is firming up vis-Ã -vis euro and the crude prices are coming down," Anantha Padmanaban, a partner at Chennai-based Nathella Anjaneyulu Chetty jewelers, told IANS.
"Oil analysts are predicting crude to touch $80 per barrel, which means gold prices have to come down," he added.
According to him, the last week saw prices remaining stable.
"On Monday, the price was Rs.1,044 per gram (22 carat) and it went up to Rs.1,111 Friday," Padmanaban said.
Speaking of supplies, he said banks have started importing and selling, resulting in low premium paid by the jewellers for gold.
"From five percent, the premium has come down to two percent and from next week onwards, there will not be any premium at all," Padmanaban said.
For the next three months, he expects gold prices to hover around $770-$840 per ounce (28.35 grams).
Meanwhile, at the retail end demand for diamond jewellery is picking up fast.
"Youngsters are willing to spend anything between Rs.25,000 and Rs.150,000 for diamond jewellery," Kirtilal Kalidas Jewellery Ltd marketing-head Balaji Viswanathan told IANS.
He said unlike gold, diamond prices are going up steadily at 8-10 percent year-on-year.