June gold imports at 12-month high

Gold imports surged in June to a 12-month high, at an estimate of 52 tonnes. This follows the Reserve Bank of India’s relaxation in May of import norms, when premium and star trading houses were allowed to import under the ‘80:20’ rule.

Meanwhile, it also appears traders have been destocking gold ahead of Thursday’s Union Budget,  in which they expect a tariff cut. On Wednesday, they were said to have sold at a discount to the market price, which brought down premiums for physical delivery to $3 an ounce.

Following the 150 tonnes of import in May 2013, the central bank had imposed stringent restrictions and also said 20 per cent of any import consignment should be re-exported, while the Union government raised the import duty to 10 per cent. Following this, the average monthly import came down to 30 tonnes. It has, as noted earlier, picked up since, with the widespread expectation of a cut in import duty. As a result, the premium for physical delivery, once as high as $180 an ounce, has fallen below $10.

RBI has also allowed gold importing banks to lease it to jewellers. Sources said the lease rates quoted are 4-4.25 per cent.

Following a surge in international prices, the price at Zaveri Bazaar here closed Rs 270 higher at Rs 28,170 per 10g on Wednesday.