India's June gold imports treble y/y on price correction (updated)

Tribhovandas Bhimji Zaveri

05/07/2022 08:52

(Adds details, dealers quote)
    By Rajendra Jadhav
    MUMBAI, July 5 (Reuters) - India's gold imports in June
nearly trebled from year-ago levels on correction in prices and
as jewellers replenished inventories after robust sales during a
key festival, a government source said on Tuesday.
    Higher imports by the world's second-biggest bullion
consumer could support benchmark gold prices  XAU= , but the
surge may increase India's trade deficit and put pressure on
ailing rupee  INR=D4 .
    The country had imported 49 tonnes of gold in June, compared
with 17 tonnes a year earlier, the source said on condition of
anonymity as he is not authorised to speak to media.
    In value terms, June imports surged to $2.61 billion from
$969 million a year ago, he said, adding that India's gold
imports still dropped to 335 tonnes in the first half of 2022
from 493 tonnes last year.
    "Across the country retail sales during Akshaya Tritiya was
robust. Stockpiles with jewellers were depleted. Jewellers were
building stocks last month after prices corrected," said a
Mumbai-based dealer with a private bullion importing bank.
    Buying gold is considered auspicious during the annual Hindu
and Jain festival, celebrated in the first week of May.
    Local gold futures  MAUc1  fell close to the lowest level in
three months in June.
    In May, India's gold imports had jumped 677% from a year ago
to the highest level in a year and contributed in widening the
country's trade deficit and putting pressure on rupee
 urn:newsml:reuters.com:*:nL1N2XT0T9
    Rising gold imports prompted New Delhi last week to raise
import tax on the bullion to 12.5% from 7.5% to discourage gold
buying and the imports. urn:newsml:reuters.com:*:nL1N2YI099  
    Local prices have suddenly jumped because of the duty hike
and prompting retail buyers to postpone purchases, said Ashok
Jain, proprietor of Mumbai-based gold wholesaler Chenaji
Narsinghji.
    "In July gold imports would be negligible. Jewellers are not
making purchases," Jain said.

 (Reporting by Rajendra Jadhav; Editing by Sherry Jacob-Phillips
and Louise Heavens)
 ((rajendra.jadhav@thomsonreuters.com; +91-22-68414378 ; Reuters
Messaging: rajendra.jadhav.thomsonreuters.com@reuters.net))