THE jewellery industry is one of the few industries which have not been negatively impacted by the COVID-19 pandemic.
When businesses were allowed to resume in May after the lockdown, people were flocking to the jewellery shops to purchase gold.
Despite the rise in gold price, it did not stopped people from buying the precious yellow metal. Gold price rose to an all-time high of RM8,374 per ounce on Aug 2 from RM6,673 per ounce on March 2. In fact, the price of gold has almost doubled since 2018.
What boosted the sale of gold was the six-month loan repayment moratorium and financial repayments – people had extra cash in hand to spare.
Traditionally, gold is seen as a safe haven for investment especially in times of market volatility. In addition, gold prices are generally quite steady.
Gold is considered valuable; people believe that it is better to buy gold than to save the money in the bank.
As a result, jewellers saw their sales doubled or tripled even as the economy in the region fell into recession.
Over the years, jewellers ensured to provide and meet their customers’ expectations by providing them with a wide range of products – to keep abreast with the latest trends.
Jewellers also ventured into e-commerce as an alternative platform for new customer acquisition, especially the younger generation.
Back in 2018, the jewellery industry cheered the zero rating of the goods and services tax (GST) – one of the key promises fulfilled by the then newly formed Pakatan Harapan government – which came into effect on June 1, 2018.
There was a three-month tax holiday period before the sales and services (SST) tax was re-introduced on Sep 1, 2018. However, jewellery remained SST-exempted thereafter.
During the three-month consumption tax holiday, jewellers in the country saw an increase in their profits as people rushed to increase their jewellery collections.
Meanwhile, the price of gold declined in November on the back of reports on the possible COVID-19 vaccine.
This serves as good news for jewellery collectors. It was reported that people have been flooding jewellery shops to take advantage of the price drop – with some exchanging old jewellery for new while some buying for investments or accessories.
The price of gold is influenced by many factors such as current developments that are happening in the world.
Although the price of the yellow metal might be volatile in the short term, it will never lose its value. It has always been seen as a hedge against inflation and also has a store of value through thick and thin. – Dec 8, 2020
