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India’s Demonetisation decision likely to affect Gold Market in the short term: World Gold Council (WGC) report

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Gold, Wikimedia

Delhi, Jan 13, 2017: India’s demonetisation decision is likely to affect gold demand in the short term, a World Gold Council (WGC) outlook report released on Friday stated.

“In India, the government’s decision to remove large denomination rupee notes took around 86 per cent of India’s circulating cash out of its economy,” according to the Outlook 2017 – Global Economic Trends and their impact on gold, released by WGC.

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“While the purpose is to replace them with newly printed notes, we believe that the liquidity squeeze could have a temporary negative effect on economic growth, and may also affect gold demand in the short term.

“But more importantly, we believe that the transition to transparency and formalisation of the economy will lead to stronger Indian growth in the longer term, thus benefiting gold,” the report added.

The WGC said there are six major trends to be watched out for in 2017 from economic perspective that would impact the gold market.

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The trends are: Heightened political and geopolitical risks; currency depreciation; rising inflation expectations; inflated stock market valuations; long-term Asian growth and opening of new markets. The report said gold is becoming more mainstream. Gold-backed exchange traded funds made gold accessible to millions of investors, primarily in the West, over the past decade, but other markets continue to expand too.”

It said, “China has seen dramatic growth in recent years through gold accumulation plans, physically settled gold contracts in the Shanghai Gold Exchange. In Japan, pension funds have increased their gold holdings over the past few years.”

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In the corporate sector, more than 200 defined-benefit pension funds have invested in gold. In addition, more than 160 defined-contribution plans have added gold to their list of investments.

“We expect this trend to continue and expand into Western markets, where pension funds have had to rethink asset allocation strategies following prolonged exposure to low (and even negative) interest rates. In our view, this will result in structurally higher demand,” the report said.

“Innovation is evident across all markets, but at the end of last year one development stood out. The Accounting and Auditing Organisation of Islamic Financial Institutions (AAOIFI), with support from the World Gold Council, launched the Shari’ah Standard for Gold, opening up the Muslim world to gold investment,” it added. (IANS)

 

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NRAI Slams Zomato for Extending its “Gold” Programme on its Delivery Platform

It is another instance of Zomato changing the goalpost

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NRAI, Zomato, Gold
The programme is currently available in 16 cities. Pixabay

The National Restaurant Association of India (NRAI) on Saturday slammed Zomato for extending its “Gold” programme on its delivery platform, saying it is a desperate attempt by the online food aggregator to shore up the sinking fortunes of its flagship Gold programme.

Zomato has announced to take its Gold programme where existing and new Zomato Gold members will be able to use Gold for home delivery orders. The programme is currently available in 16 cities.

Zomato Gold was till date available only on eating out at fine-dine restaurants.

“It is another instance of Zomato changing the goalpost. Gold was originally launched as a tool to promote the culture of ‘dining out’, but now it is being extended on deliveries too,” said NRAI, which has been at loggerheads with Zomato regarding the Gold programme over deep discounting practices.

NRAI, Zomato, Gold
The National Restaurant Association of India (NRAI) on Saturday slammed Zomato for extending its “Gold” programme on its delivery platform, saying it is a desperate attempt. Pixabay

“Essentially, it is now a programme that merely promotes ‘deep discounts’ on both dine-in and delivery verticals, the cost of which is borne solely by the restaurant partners,” the restaurants’ trade body added.

NRAI also said that it continues to remain firm in its belief that Zomato Gold in its current form is an unacceptable proposition.

“We expressed the same unequivocally to the Zomato team in our recent talks. However, in utter disregard to the viability of the restaurant fraternity, they have chosen to extend the programme further to the delivery vertical as well,” the NRAI said.

“The NRAI remains steadfast in its belief that Zomato Gold in its current form is not acceptable in either dine-in or delivery segment,” Anurag Katriar, President of NRAI, had said in a statement.

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According to the NRAI, Zomato’s move will be calamitous to the business in the delivery segment and NRAI appeals to all restaurants and cloud kitchen entrepreneurs to stay away from Zomato Gold on delivery.

“Offer right quality at the right price, rather than falling for such discount gimmicks,” NRAI told Zomato, adding that the #ZoGoIsNoGo campaign is on and “we continue to #StayLoggedOut.”

According to Zomato, food delivery was in its early stages when it launched the Gold programme in 2017.

“We thank our restaurant partners for all the feedback, and users for the love they have shown towards Zomato Gold. It is very much these conversations, that led us to put forward a better and bigger Gold programme,” Gaurav Gupta, Co-founder and COO, Zomato, said in a statement.

NRAI, Zomato, Gold
Zomato has announced to take its Gold programme where existing and new Zomato Gold members will be able to use Gold for home delivery orders. Pixabay

The Gold programme drives 25-30 per cent business for its restaurant partners and more and more Gold users (90 per cent) are exploring new restaurants because of the programme.

“It, therefore, makes eminent sense to extend this discovery behaviour to the delivery restaurant base,” said Gupta.

Zomato has always been hellbent to make its contentious Gold programme available for delivery.

“With over 13,000 establishments across 41 cities, Zomato Gold for Delivery brings a wide choice of great restaurants to Zomato Gold members,” added Mohit Gupta, CEO, Delivery, Zomato.

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Gold on delivery will offer the second-highest priced item on the order for free, except for combos, MRP items and special dishes.

It will only apply on minimum order values of Rs 300 with discount capped at Rs 300 per order.

New users will pay Rs 1,800 for an annual package that will give them access to dining out and delivery privileges. (IANS)