Gold importers struggle to sell discounted stocks

MUMBAI Thu Jan 24, 2013 2:54pm IST

A goldsmith holds finished gold bangles at a workshop in Kolkata January 16, 2013. REUTERS/Rupak De Chowdhuri/Files

A goldsmith holds finished gold bangles at a workshop in Kolkata January 16, 2013.

Credit: Reuters/Rupak De Chowdhuri/Files

Related Topics

MUMBAI (Reuters) - Gold importers in India, the world's biggest buyer of the metal, struggled to clear their old stock even at a discount to market price while consumers digested a 50 percent hike in import tax.

* Sales have been declining in a wedding season, which will continue till May, while festivals are also scheduled during this period. However, over the longer term, industry officials say gold demand is unlikely to waiver.

* "Traders had stocked before the tax in anticipation of demand, but now the market has slowed," said Lokesh Kumar Agarwal, chairman of Lucknow-based wholesaler Brijwasi Bullion and Jewellers, adding people are offering discounts of 100 rupees.

* Gold for February delivery on the Multi Commodity Exchange (MCX) was 0.28 percent lower at 30,606 rupees per 10 grams by 2:50 p.m., in line with global markets.

* The yellow metal had touched a high of 30,847 rupees on January 21, when the federal government raised import tax to 6 percent from 4 percent.

* Global gold inched down, pulling further away from a one-month high hit earlier in the week, as increasing confidence in the global economic recovery dulls bullion's appeal as a safe-haven investment.

* A weaker rupee kept the downside in prices limited. The rupee plays an important role in determining the landed cost of the dollar-quoted yellow metal.

* Silver for March delivery on the MCX was 0.76 percent lower at 59,410 rupees per kg.

(Reporting by Siddesh Mayenkar; Editing by Subhranshu Sahu)

FILED UNDER:

Economic Pulse

REUTERS SHOWCASE

Vodafone Tax Dispute

Vodafone Tax Dispute

India advised against challenging Vodafone tax ruling - source  Full Article 

Banking Sector

Banking Sector

India's laggard state lenders face tough sell on capital raising plan  Full Article 

Trade Deal

Trade Deal

WTO postpones trade deal by a day after last-minute objection.  Full Article 

Falling Oil Prices

Falling Oil Prices

Saudis signal no push for oil cut as market to "stabilise itself"  Full Article 

Raising Stake

Raising Stake

Nippon Life to raise stake in Reliance Capital fund unit  Full Article 

Sterilisation Camps

Sterilisation Camps

Sterilisation targets remain in all but name, critics say  Full Article 

Share Buyback

Share Buyback

Samsung Electronics to buy back $2 billion in shares  Full Article 

Microsoft in China

Microsoft in China

Microsoft to pay China $140 million for 'tax evasion'   Full Article 

Flashback: 26/11

Flashback: 26/11

The three-day attack in November 2008 left 166 dead.  Slideshow 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage