GOLD buyers in India stayed on the sidelines today as prices firmed above Rs15,500 ($312/£217) in the middle of the wedding season, with scrap meeting most of the little demand, traders said.
“The last two months have been a disaster for gold sales,” said Daman Prakash, director with Chennai-based large wholesaler MNC Bullion.
“I have around 242kg of gold lying in my godown, and of three tons of silver bought in December, I have 1.8 tons left,” Prakash added.
“The offtake is zero at the customs (importers) level, banks level and even at our (wholesale) level,” Prakash added.
The benchmark gold April contract was 1.23 per cent higher at Rs15,645 ($314/£218) per 10 grams at 2:10 p.m., after having struck a new record high of Rs15,706 ($317/£221) in the last session.
“Most weddings are taking place with gold available in the household,” said Prakash, adding “they are exchanging old for new.”
“There are many sellers, but no buyers,” said Haresh Acharya, head of bullion desk with Parker Agrochem Exports in Ahmedabad.
“If gold prices drop below Rs13,000 ($262/£182), then we might see some revival in demand,” Acharya added.
Traders said most of the local demand is met by scrap, restricting demand for imported new bars.
“There is so much scrap coming in, sufficient to meet demand,” added Acharya.
Gold purchases by India are on course to fall for the second month in a row with no imports so far in February because of high prices, the head of a trade body said.
