* Indian jewellery stores seeing lower footfalls- dealer
* China discounts narrow to $5/oz from $12-$16 earlier this
* Singapore investment demand strong as inflation a
By Rajendra Jadhav and Swati Verma
June 18 (Reuters) – Gold purchases in India ticked up in the
later part of the week after a decline in local rates, although
dealers cautioned that demand is unlikely to return to normal
The fall in bullion prices also stirred buying in top
consumer China, pushing down discounts to around $5 per ounce
versus global benchmark spot rates, from $12-$16 earlier
this week, dealers said.
Jewellers and bullion dealers in India were making small
purchases on Thursday after prices corrected sharply, said
Harshad Ajmera, the proprietor of JJ Gold House, a wholesaler in
“Retail demand is slowly improving but unlikely to go back
to normal level anytime soon,” he said.
Local gold futures fell to 46,744 rupees on
Thursday, a trough since May 5. Discounts were unchanged at
about $12 an ounce, the highest since mid-September 2020, on
official domestic prices — inclusive of 10.75% import and 3%
Jewellery stores have opened in most parts of the country
but they are witnessing lower footfalls, said a Mumbai-based
bullion dealer with a gold importing bank.
“The industry is sceptical on how quickly demand would
recover to normal level. Many believe it may not before
festivals in August,” the dealer said.
In Singapore, premiums remained at $1.20. Demand for gold
bars and coins for investment remains strong as inflation
concerns continue to worry investors, said Zvika Rotbart, South
East Asia business development executive at J. Rotbart & Co.
Relatively lower premiums over the last month or so, are
leading to “margin compression” from a dealer standpoint, said
David Mitchell, the managing director at Indigo Precious Metals.
Demand is still tempered “as the local markets simply do not
understand the global macro-economic storm that’s heading
towards us and already here,” Mitchell added.
Japanese customers, meanwhile, await further dips to step up
purchases, a Tokyo-based trader said, quoting $0.50 per ounce
(Reporting by Arundhati Sarkar and Brijesh Patel in Bengaluru;
Editing by Arpan Varghese and Amy Caren Daniel)