Indian gold buyers put off by price rebound, Chinese jewellers stock up

Published on Dec 11, 2020 10:45 PM IST
Local gold futures rebounded to around 49,100 rupees per 10 grams on Friday, from its lowest since June 19, at 47,550 rupees, touched last week.
Woman looks at a gold necklace at a jewellery showroom amidst the spread of Covid-19 in Kolkata.(Reuters File Photo)
Woman looks at a gold necklace at a jewellery showroom amidst the spread of Covid-19 in Kolkata.(Reuters File Photo)
Bengaluru/Mumbai | ByReuters | Posted by Kanishka Sarkar

Retail consumers in India slowed gold purchases this week put off by higher local prices, while top consumer China saw a slight pick-up in demand as jewellers stocked up going into year-end.

Local gold futures rebounded to around 49,100 rupees per 10 grams on Friday, from its lowest since June 19, at 47,550 rupees, touched last week.

“Retail jewellery demand has been coming down due to volatile prices,” said Anoop Chemmanur, managing director of Chemmanur Jewellers in Bangalore.

Premiums eased to $2.5 an ounce over official domestic prices, inclusive of 12.5% import and 3% sales levies, from $3.5 last week.

“Jewellers are confused. There’s no clear trend,” said a Mumbai-based bullion dealer with a private bullion importing bank.

In China, gold was sold at a discount of $19-$24 an ounce against international spot prices, versus $20 last week.

“Vaccines will decide the future of the market,” said Ronald Leung, chief dealer, Lee Cheong Gold Dealers in Hong Kong.

Chinese dealers have been forced to offer hefty discounts for much of this year as the Covid-19 pandemic hammered demand, although the discount has narrowed in the past few weeks.

“Demand has been improving this week as jewellery retailers have stocked up inventories for end of the year,” said Samson Li, Hong Kong-based precious metals analyst at Refinitiv GFMS

But fourth-quarter demand will likely be about 10% lower than last year, Li added.

The Singapore market saw premiums of about $1.20 an ounce.

“At this time of the year, gold prices generally dip and investors are waiting for that, because of which we’re not seeing much demand right now,” said Vergel Villasoto, director at Silver Bullion.

In Japan, gold was sold between flat and a $0.50 premium.

Gold investment demand could fall when vaccines hit the Japanese market around January-February, a Tokyo-based trader said.

SHARE THIS ARTICLE ON
Close Story
SHARE
Story Saved
×
Saved Articles
Following
My Reads
Sign out
New Delhi 0C
Tuesday, August 09, 2022
Start 15 Days Free Trial Subscribe Now