Dip In Prices Entices Gold Customers In India
Customers in the world's biggest gold market are taking advantage of the current dip in prices to make purchases ahead of the wedding season.
The near three-year-low in the price of gold has renewed buying interest in the precious metal across India, with gold prices dropping from nearly $1,900 in 2011 to around $1,250 per ounce.
While customers flocked to gold stores across India, jewellers and exporters in the traditional hub of Jaipur in the western Indian state of Rajasthan said the depreciation in the value of the Indian rupee was also making gold jewellery attractive for both domestic buyers as well as the export markets.
While customers and jewellers across India are pinning their hopes on a further decline in the price of gold, some experts at trading firm Trustline in the Indian capital, said they expect a marginal bounce back in the prices in the short term.
Earlier in April, a sudden crash in global gold prices had triggered a frenzy of buying, as gold fell at its sharpest level in 30 years.
The Indian government, facing a ballooning trade deficit, has banned consignment imports and hiked its import duty on gold. Gold edged higher on Wednesday (July 3) after a near one percent fall in the previous session, as Asian stocks eased.
While the deficit is likely to narrow for the current fiscal year, its funding remains a concern on the back of foreigners pulling out of Indian debt and equities.
Presented by Adam Justice