Soaring gold prices further erode lustre in pandemic-hit retail hubs

FILE PHOTO: A saleswoman displays a gold necklace to a customer inside a jewellery showroom in Mumbai, India April 18, 2018. REUTERS/Francis Mascarenhas

BENGALURU/MUMBAI (Reuters) – Physical gold remained out of favour in most Asian hubs this week as a worsening pandemic kept retail buyers away with global benchmark spot prices at historic highs, while logistical challenges plagued the Indian market.

Spot gold scaled a record $2,072.50 per ounce on Friday.

Dealers in top buyer China offered discounts of $70-$60 per ounce against the benchmark versus last week’s record $88-$42 range.

“Young people have no interest in buying gold jewellery and due to the pandemic, there are no tourists,” said Peter Fung, head of dealing at Wing Fung Precious Metals.

In Hong Kong, dealers charged anywhere between a $2 per ounce discount to a $1.5 premium.

“Selling has increased and the Chinese are more willing to trade silver,” said Samson Li, a Hong Kong-based analyst at Refinitiv GFMS.

In India, premiums eased to about $4 an ounce over official domestic prices, from last week’s $8.

Limited supplies due to suspension of international flights has been allowing dealers to charge premiums, said a Mumbai-based dealer with a bullion importing bank.

Local gold futures soared to a record 56,191 rupees per 10 grams on Friday.

“A few investors are buying coins and bars, but their share is tiny in the overall market,” said Harshad Ajmera, proprietor of JJ Gold House, a wholesaler in the city of Kolkata.

In Singapore, premiums were unchanged at $0.8-$1.50, while Japan saw premiums of $0.50.

Investors sold gold to take profits, while high net worth clients awaited a price correction to accumulate more metal, said Brian Lan of Singapore dealer GoldSilver.

Meanwhile, the Bangladesh Jewellers Association raised local rates to a new record of 77,215 taka ($912.38) per Bhori, or 11.664 grams.

“We’ve never seen such kind of demand destruction happening,” said Dilip Kumar Agarwala, the association’s general secretary.

(Reporting by Brijesh Patel, Arpan Varghese and K. Sathya Narayanan in Bengaluru, Rajendra Jadhav in Mumbai and Ruma Paul in Dhaka; Editing by Maju Samuel and David Evans)

Share

LEAVE A REPLY

Please enter your comment!
Please enter your name here


By submitting this form, you are consenting to receive marketing emails from: News India Times | Desi Talk Headlines | Desi Talk Chicago, 35 JOURNAL SQ, JERSEY CITY, NJ, 07306, http://www.newsindiatimes.com. You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email. Emails are serviced by Constant Contact