India’s gold demand has seen a noticeable slowdown this week as the festive fervor settles, and buyers adopt a cautious stance amid recent price corrections. Meanwhile, international markets in China and Singapore are witnessing a spike in purchases, driven by lower rates and attractive pricing.
Market Performance: Domestic Gold Slows
Physical gold purchases in India dipped this week as consumers paused, anticipating further declines in prices.
- Indian dealers quoted premiums up to $25 per ounce over official domestic rates, unchanged from last week.
- Domestic gold traded around Rs 122,700 per 10 grams on Friday, down from a record high of Rs 132,294 last week.
- Globally, spot gold prices are on track for their first weekly drop in 10 weeks.
A Mumbai-based jeweller noted, “Last week, buyers snapped up gold at any price. This week, the price correction has made them cautious, with some postponing purchases for a bigger drop.”
Main News: Post-Festival Pullback
The recent festival season, including Dhanteras and Diwali, traditionally drives gold purchases in India, being considered highly auspicious for buying jewelry and bullion.
- Despite the celebrations, buyers have slowed their pace this week.
- New import orders are now placed cautiously and in smaller quantities, reflecting expectations that the next week’s import base price may fall.
The base import price, used to calculate import duty, is set fortnightly, influencing buying decisions in the domestic market.
Company & Dealer Insights: Global Buying Picks Up
While India’s demand cooled, overseas markets responded differently:
- China: Bullion traded at discounts of $20 to a premium of $8 over global benchmark spot prices.
- Hong Kong: Gold sold at par to a $2.20 premium.
- Singapore: Prices ranged at par to a $2.50 premium, drawing buyers seeking favorable entry points.
- Japan: Gold traded at a $1 premium over spot prices.
Bernard Sin, Regional Director at MKS PAMP Greater China, highlighted, “Despite sharp fluctuations between $4,000 and $4,300 per ounce, traders are holding positions rather than offloading physical gold. Sellers remain limited, while investors maintain their holdings amid macroeconomic uncertainty.”
Brian Lan, Managing Director at Singapore-based GoldSilver Central, added, “The recent price drop has spurred interest. Clients are actively buying both gold and silver to take advantage of market conditions.”
Summary: A Tale of Two Markets
India’s gold market is taking a breather post-festivals, as cautious buyers wait for potentially lower prices. Meanwhile, international markets are seizing the opportunity, with China, Singapore, and other Asian markets showing steady demand.
- Domestic gold prices: Rs 122,700 per 10 grams
- Premiums over official rates: $25 per ounce
- Global spot prices: $4,000–$4,300 per ounce
The contrasting dynamics highlight how local cultural factors and global economic conditions drive gold demand differently across regions.
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