Asia Gold-Indian jewellers stay shut as lockdowns stifle demand

SouthGobi Resources

28/05/2021 12:01

* India discounts at highest in eight months
    * Imports into China via Hong Kong, Switzerland jump in
April
    * China gold premiums little changed at $7-$10/oz
    * Singapore premiums at $1.2-$1.7/oz

    By Rajendra Jadhav and Brijesh Patel
    May 28 (Reuters) - Physical gold demand in second-biggest
bullion consumer India was negligible this week with most
jewellery stores still shut by COVID-19 lockdowns, forcing
dealers to offer steep discounts. 
    "Lockdowns are badly hitting the industry. Jewellers have
stopped buying since retail demand is almost zero," said Ashok
Jain, proprietor of Mumbai-based gold wholesaler Chenaji
Narsinghji.
    Most states have imposed curbs as infections crossed 27
million, with over 3,000 people dying every day.  urn:newsml:reuters.com:*:nB8N2MC01M
    Dealers offered discounts of up to $10 an ounce, the highest
since mid-September 2020, over official domestic prices —
inclusive of 10.75% import and 3% sales levies — unchanged from
last week.
    A few states are considering easing restrictions from June 1
and that could help attract retail consumers, said a
Mumbai-based bullion dealer with a gold importing bank.
    On Friday, local gold futures  MAUc1  traded around 48,400
rupees per 10 grams, having scaled a peak since Feb. 1 at 49,067
rupees earlier this week.
    Chinese premiums were little changed at $7-$10 an ounce over
benchmark spot gold prices.  XAU=   GOL/  
    Net gold imports into the country via Hong Kong jumped in
April to a nearly three-year high, while Swiss exports to China
also soared, as demand staged a rebound from last year's
pandemic slump.
    Imports could increase further with Beijing having given
banks permission to import large amounts of gold.  urn:newsml:reuters.com:*:nL8N2M754I
    In Hong Kong, premiums of $0.8-$2 an ounce were charged. 
    Singapore premiums were little changed at $1.2-$1.7.  
    Brian Lan, managing director at dealer GoldSilver Central
said the first few days of the week saw more selling due to
higher prices although some high net worth individuals looked to
buy up before prices move even higher.
    Japanese dealers sold gold at anywhere between flat to an
$0.30 premium. 
    At current prices, "not many individual investors are
willing to buy gold bars" and some were selling, a Tokyo-based
dealer said.

 (Reporting by Arundhati Sarkar, Brijesh Patel and Arpan
Varghese in Bengaluru;)
 ((arpan.varghese@thomsonreuters.com))