Indian gold demand eased on Friday as prices rebounded from a three-month low, while buying interest in China picked up slightly. International spot gold headed for its first weekly gain in five, trading above $4,100 after weak U.S. payrolls data cooled Federal Reserve rate hike expectations.
Indian buyers eased off this week after a modest pick-up earlier, as gold prices rebounded from a three-month low, while buying interest in China improved slightly.
India demand cools as prices recover
Domestic gold prices in India rose to as much as 148,046 rupees per 10 grams ($1,553), after touching 140,450 rupees on Tuesday, the lowest level since March 27. Prices had fallen about 8.4% in June, the first monthly drop since March, tracking swings in international prices.
That correction drew buyers back early in the week before the rebound sapped their appetite. According to Reuters: "Once prices corrected, they began making small purchases at the beginning of the week", said a Kolkata-based jeweller.
Dealers quoted a premium of up to $5 an ounce and a discount of $7 over official domestic prices this week, inclusive of 15% import and 3% sales levies, compared with last week's premium of up to $6. A Mumbai-based bullion dealer said volatile prices kept jewellers cautious and noted the lean demand season had started, with no major festivals soon.
China buying improves, support seen near $4,000
In China, gold traded at par to discounts of $2 an ounce to the global benchmark spot price, compared with last week's discount of $3 to $7. Peter Fung, head of dealing at Wing Fung Precious Metals, said $4,000 looked like good support and expected the market to stay there for a while, adding that lingering uncertainty was making people hesitate to buy too much.
Internationally, spot gold was headed for its first weekly gain in five and traded above $4,100, as weak U.S. payrolls data eased Federal Reserve interest rate hike expectations.
Elsewhere in Asia, gold in Hong Kong traded between a $0.50 discount and a $1.70 premium, while Japan saw a $0.50 discount and Singapore ranged from a $1 discount to a $1.60 premium.
Source: Reuters
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