Gold imports surge by 71% in April '10

Gold imports surged by 71 per cent to 34.2 tonne during April 2010 compared to the year-ago period as prices declined to touch a low of Rs 16,262 against the record Rs 18,500 level achieved in December 2009.

The shipments during April 2009 had stood at just 20 tonne due to less demand following global economic crisis, according to data provided by the Bombay Bullion Association.

Gold prices ruled in the range of Rs 16,262 and Rs 17,140 per 10 grams in the previous month on rise in both seasonal as well as investment demand, an industry expert said.

In the international markets the precious metal touched a low of $1,111 an ounce (28.34 grams) and a high of $1,182 an ounce during April.

"Whenever there is decline in gold price, even if a small one, the demand for the precious metal goes up," Brokerage firm SMC Global's analyst said.

Moreover, he said, the period between April and July is the peak domestic season, comprising both festival and marriage season, during which stockists tend to add on to their inventory.

The imports during January stood at 34 tonnes. Gold shipments had declined during February and March to 28.8 tonne and 27.8 tonne, respectively, following slight recovery in prices and slowdown in demand due to the off-season.

However, gold prices have recovered since April to touch an all time high of Rs 18,550 per ten gram in the domestic market and highest level of $1,245 an ounce in the international markets on May 12.

Gold prices surged as investors shifted funds to bullion on fears that the European sovereign debt crisis might depress currencies.

Gold is considered as a safe haven in times of crisis.

The yellow metal for MCX June contract ruled at Rs 18,390 per 10 grams, while in the international markets it was trading at $1,189 an ounce.