Indian gold demand weak as jewellers postpone purchases

MUMBAI Mon Feb 18, 2013 4:48pm 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 demand in India, the world's biggest buyer of the metal, remained sluggish on Monday as buyers postponed purchases expecting a sharp drop in prices.

As of 1052 GMT, the most active gold contract for April delivery on the Multi Commodity Exchange (MCX) was 0.01 percent lower at 30,190 rupees per 10 grams.

"Demand is weak from local jewellers. Investment demand is also weak. Jewellery exporters are buying, but they are also cautious," said a Mumbai-based dealer with a state-run bank.

"Most jewellers are on the sidelines. They are expecting a sharp drop in prices."

The rupee plays an important role in determining the landed cost of the dollar-quoted yellow metal. It fell on Monday.

After a 50 percent import duty increase to 6 percent on January 21, the Reserve Bank of India recommended putting curbs on imports, along with launching gold-linked products to limit shipments.

The government may further raise import duties on gold or put a cap on purchases in a bid to rein in the current account deficit in the 2013/14 budget, an official with the biggest state-run gold importer MMTC said on Monday.

The silver contract for March delivery on the MCX was 0.25 percent higher at 56,204 rupees per kg.

The following were the prices of gold and silver in rupees as of 1.15 p.m. local time in the spot market, quoted by HDFC Bank.

(Reporting by Rajendra Jadhav; Editing by G.Ram Mohan)

FILED UNDER:

Surprise Rate Cut

Reuters Showcase

Eicher Share Sale

Eicher Share Sale

Truck maker Volvo sells shares in Eicher Motors  Full Article 

Services Growth

Services Growth

Services growth at eight-month high in Feb - HSBC PMI  Full Article 

StanChart Results

StanChart Results

StanChart rules out share sale as profit plunges 25 pct  Full Article 

Bond Market

Bond Market

Bonds at 20-month highs, rupee gains after surprise rate cut  Full Article 

Jim O’Neill Interview

Jim O’Neill Interview

'India can become world’s fifth-largest economy by decade’s end'  Full Article 

Coal Imports

Coal Imports

India coal imports in Feb jump from year ago, but drop m/m  Full Article 

China Services

China Services

China Feb HSBC services PMI edges up to 52.0 as orders improve  Full Article 

Next Superhero

Next Superhero

Franchise Man swoops in to save Bollywood  Full Article 

Budget 2015

Budget 2015

Budget announcements and reactions from the industry  Full Coverage 

Reuters India Mobile

Reuters India Mobile

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