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Asia Gold: Indian jewellers stock up; holiday dims activity elsewhere

Reuters  |  MUMBAI/BENGALURU 

By Rajendra and Karthika Suresh Namboothiri

MUMBAI/BENGALURU (Reuters) - Demand for physical gold in rose this week as jewellers stocked up for a major exhibition, allowing dealers to cut discounts to the lowest in two months, while the Lunar New Year holiday kept activity subdued in other major Asian hubs.

Dealers in India, the world's second biggest gold consumer after China, were offering discounts of up to $1.5 an ounce over official domestic prices, the lowest since the second week of December, as against $4 discounts last week. The domestic price includes a 10 percent import tax.

Demand improved as jewellers made purchases for next week's exhibition, said Mukesh Kothari, at RiddiSiddhi Bullions in Mumbai, referring to the International Jewellery Show that kicks off in India's financial capital on Sunday.

Earlier this week gold prices in jumped above 34,400 rupees ($482.65) per 10 grams, not far from a record high of 35,074 rupees hit in August 2013. Local prices have jumped more than 13 percent in the past six months.

The rally has, however, been prompting many to postpone purchases, said a Mumbai-based with a bullion importing

"Some are selling gold instead of buying. They are cashing in on higher prices," the said.

Scrap gold supplies in India may increase this quarter as a rally in local prices has prompted consumers to sell old trinkets and jewellery.

Markets in were closed for the entire week for the Lunar New Year.

Customer business was "less than normal" this week across much of because of the holiday, said Gregor Gregersen, of retailer Silver Bullion Pte Ltd.

"However, in the run up to the holiday, there was considerable activity in products such as the 'Lunar Year of the Pig' bullion coins and other for gift-giving."

Activity was subdued in and Hong Kong as well.

"There is some retail buying, but jewellers and wholesalers are closed," said Brian Lan, managing at dealer GoldSilver Central in

Premiums of around 80 cents were being charged over the benchmark in Singapore, unchanged from the previous week, Lan said.

International benchmark spot gold prices were on track for their first weekly decline in three, but were still supported above the $1,300 an ounce level.

In Hong Kong, premiums of 50 cents-$1.20 were being charged, said Ronald Leung, at Lee Cheong Gold Dealers in Hong Kong.

In Japan, dealers offered discounts of about 50 cents for a second week, a said.

($1 = 71.2730 Indian rupees)

(Reporting by Karthika Suresh Namboothiri, Nallur Sethuraman in Bengaluru, and Rajendra in Mumbai; editing by and Emelia Sithole-Matarise)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, February 08 2019. 17:59 IST
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