India dealers widen discount to $10/oz this week
China premiums slip on lower demand
India’s June gold imports fall to two-year low
By Rajendra Jadhav and Brijesh Patel
Gold demand in India remained subdued this week, as near record-high prices kept buyers at bay and prompted dealers to widen discounts to lure them, while elevated rates curtailed activity across other major Asian hubs as well.
Indian dealers were offering a discount
up to $10 an ounce over official domestic prices – inclusive of 6% import and 3% sales levies – up from the last week’s discount of up to $8.
“Jewellery stores all over the country are seeing fewer customers. People aren’t ready to buy just yet… They’re holding off, hoping prices will come down,” said a Kolkata-based jeweller.
Domestic gold prices were trading around 97,500 rupees per 10 grams on Friday after hitting an all-time peak of 101,078 rupees last month.
Gold discounts could have risen sharply due to weak demand, but supplies are limited because of a sharp fall in imports, said a Mumbai-based bullion dealer with a private bank.
India’s gold imports in June fell 40% from a year ago to 21 tons, their lowest level in more than two years, amid sluggish demand.
In China, the world’s top gold consumer, dealers quoted discounts of $5 per ounce to $10 premium on spot rates, down from the premiums of $10-$25 charged last week.
“In China, I don’t see too much physical buying interest at this moment due to the summer holiday. Maybe from October, you can expect the demand to pick up,” said Peter Fung, head of dealing at Wing Fung Precious Metals.
In Hong Kong, gold
was sold at $1-$2 premiums, while dealers in Singapore
sold gold at par with the global benchmark to a premium of up to $2.20.
In Japan, bullion
traded between a $0.50 discount and a $1 premium. (Reporting by Brijesh Patel and Anushree Mukherjee in Bengaluru, Rajendra Jadhav in Mumbai; Editing by Eileen Soreng)
