By Pablo Sinha and Rajendra Jadhav
July 10 (Reuters) – Gold traded at a wide discount in India this week as price volatility weighed, while demand in China remained steady with the country’s central bank reporting its largest monthly increase in gold reserves in more than 2-1/2 years in June.
International spot gold prices slipped to a two-week low, retreating from an over 2% jump last week. Domestic gold prices in India were also trading around 144,800 rupees per 10 grams on Friday, after rising to 148,069 last week. [GOL/]
“Buyers are now waiting for a bigger drop in prices before making purchases,” said Ashok Jain, proprietor of Mumbai-based gold wholesaler Chenaji Narsinghji.
Dealers offered gold at discounts of up to $19 an ounce over official domestic prices this week, including 15% import and 3% sales taxes, compared with premiums of up to $5 an ounce and discounts of up to $7 an ounce a week earlier.
“Retail buying has slowed, and most transactions are now exchanges of old jewellery for new. As a result, jewellers have little need to replenish inventories by buying gold from banks,” a Mumbai-based bullion dealer with a private bank said.
In China, bullion traded at discounts of $1 to premiums of $5 an ounce to the global benchmark spot price, compared to last week, when it traded at par to discounts of $2.
“The central bank added 480,000 ounces in June, extending its streak to 20 months and lifting reserves to 75.44 million ounces. This counter‑cyclical buying is helping stabilize prices,” said Bernard Sin, regional director of Greater China at MKS PAMP.
In Hong Kong, gold traded between a $1 discount and a $1.70 premium.
Hong Kong launched a central clearing system for gold on Tuesday and also revived dollar gold futures trading, as it seeks to become a regional reserve hub for the precious metal.
In Singapore, gold was sold between a $1 discount and a $2 premium, while in Japan, it was sold at a discount of $0.40.
(Reporting by Pablo Sinha in Bengaluru and Rajendra Jadhav in Mumbai; Editing by Sherry Jacob-Phillips)
Source: Original Article
