Gold imports fell to zero for the second month in a row in March, owing to absence of demand in the domestic market following high gold prices, which are still ruling over Rs 15,000 per 10 gm level.
“Gold import during March is zero due to lack of demand because of high prices. Unless the prices goes down, there will be hardly any imports,” Bombay Bullion Association Director Suresh Hundia said.
Imports during March 2008 stood at 21 tonnes. The total imports during January-March 2009 were at 1.8 tonnes as compared to 61 tonnes a year ago.
When asked if festive occasions like ‘Akshaya Tritiya’ - a festival which is considered auspicious to buy gold - will boost demand, Hundia said, it all depends on the prices. “To buy gold you need money and unless the prices are favourable there will be no demand,” he pointed out.
According to analysts, gold is ready for correction and in April the prices might go down considerably boosting the demand.
There is a possibility of prices coming down due to lack of buying interest triggered by low confidence on the yellow metal at higher levels, Bonanza Commodity Brokers’ Assistant Vice-President (Commodity Research) Tarun Satsangi said.
“In the spot market, if the prices goes down below Rs 14,900 per 10 grams level, then there is every chance that it might slide to Rs 13,500 per 10 gm level in April,” Satsangi said.
Gold prices in the domestic spot market were ruling at Rs 15,100 per 10 gm today, while in the international market it was at $918 an ounce (28.34 gm).
Brokerage firm SMC Global Vice-President Rajesh Jain opined that the gradual recovery seen in the equity market might prove negative for gold.
“If gold prices goes down $900 an ounce level then correction will definitely take place,” he said.
Most likely prices will dip during April and it will rule at Rs 14,000-14,500 per 10 gm level in the domestic spot market and in the global markets it may rule at $830 an ounce, he added.
