Mumbai, Bengaluru
Physical gold buying has waned in major Asian centres as bullion prices rebounded from recent lows, with dealers in India offering the metal at a discount for the first time in over a month as an uptick in local rates moderated demand.
In India, the world’s second-biggest consumer of the metal after China, gold was being sold at a discount of up to $2 (Dh7.35) an ounce over official domestic prices this week, compared with a premium of $1 last week.
The domestic price includes a 10 per cent import tax. “The market lost momentum due to the price rise. Buyers are waiting for prices to fall below $1,200,” said Harshad Ajmera, the proprietor of JJ Gold House, a wholesaler in Kolkata.
In the Indian market, gold futures were trading around Rs30,607 per 10 grams on Friday afternoon, up more than 4 per cent from their lowest level in seven months hit on August 17. “As the rupee started appreciating in the last few days, jewellers are taking a pause,” said a Mumbai-based dealer with a private bank.
The Indian rupee was trading around 71.93 after hitting a record low of 72.92 per dollar earlier this week.
Meanwhile, premiums in China have ranged between $3 and $6 an ounce this week, versus last week’s $6-$7, traders said. “There was some buying when prices fell below $1,200 but now it’s pretty quiet. We don’t see too many people chasing at the current levels,” said Ronald Leung, chief dealer at Lee Cheong Gold Dealers.
Benchmark spot gold prices have risen about 4 per cent from a 19-month low of $1,159.96 hit on August 16.
“There was some physical buying in China on Friday after a slow week and premiums firmed to around $6,” said Peter Fung, head of dealing at Wing Fung Precious Metals in Hong Kong.
— Reuters
