Friday, May 14, 2010

Indian Retail Demand Smothered By High Gold Prices

According to a report by the Economic Times, Indian retail demand for gold pre-Askhay Tritiya festival is effectively zero. Moreover, sellers are beginning to emerge.
"Forget buying for the festival, on the contrary people are selling," said Suresh Hundia, president of the Bombay Bullion Association in Mumbai.

"There is a queue of sellers."...

"If prices stay like this, near all-time highs, physical demand could take a hit and a lot of scrap could start coming in. Imports for the full year could fall by 25-30 per cent," said Abhishek Raval, a precious metals manager at IndusInd Bank.
The article does mention that investment demand is increasing despite jewelry demand dropping.

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