 "Gold quoting at a premium as demand improves")
Gold was quoted at a premium of $1-2 an ounce on Monday in early trade at Zaveri Bazar here, on Dussehra-related demand.
The bullion market is seeing demand revival after almost two quarters. Initial signs of better consumer sentiment was reflected in the sales reported by online e-commerce sites Amazon and Flipkart. Three months earlier, imported gold was being quoted at a discount of $50 an oz or Rs 1,100-1,200 per 10g.
In the past fortnight, gold has fallen in the international market by 5.8 per cent; the price in India is down 4.9 per cent. With the 'pitrupaksha' period over, when buying of gold is considered inauspicious, festive demand has started.
A veteran analyst said, “As prices have fallen sharply in the past week, India's demand is returning. Demand is expected to be 50 per cent higher by Diwali.”
Traders say Chinese consumers have also returned. The two countries together constitute 45 per cent of global demand.
Saurabh Gadgil, chairman, PNG Jewellers, and director, Indian Bullion and Jewellers Association, said: “Consumer sentiment has improved and people have started buying. They are also buying gold coins and jewellery. Since at a lower price the sellers are few, the market is quoting at a premium.” On Monday, this was around Rs 300 per 10g ($3-5 an oz), depending upon individual jewellers’ stocks. However, when the market closed on Monday, average market was at a discount of $4 in Ahmedabad, according to NCDEX polling
With the fall in prices since early October, traders were expecting a reduction in the tariff but this hasn't taken place and so, imports have started but cautiously note. Traders say it will pick up with a fall in the tariff value. Gadgil adds that companies have started ordering silver and gold coins (for gifting), not seen in the past two years.
