From Bloomberg:
Gold imports by India this year may reach 2009's level as early as this month because of "robust" demand in the world's biggest buyer of bullion, according to the World Gold Council.
Purchases in the six months ended June were 348 metric tons, compared with 559 tons in all of last year, the group said. Jewelry demand surged 67 percent to 272.5 tons in the period and sales for investment more than tripled to 92.5 tons.
"The imports, if the trend continues, should cross last year's figure any time in July-August," Ajay Mitra, managing director for Middle East and India at the World Gold Council, told reporters in Mumbai today.
India's bullion demand almost doubled in the first half even as prices climbed to a record in June as higher incomes stoked purchases of rings, chains and necklaces, and investors sought a haven. Households in the South Asian country, where women are the biggest users of gold, typically increase jewelry purchases in the second half for festivals and weddings.
"Even at these prices there is latent demand in the form of jewelry and in retail investment," Mitra said. "People are earning a substantial amount, which is fueling demand for number of categories including cars, jewelry, electronic goods."
The festival season starts next month and bullion sales usually reach their peak during the Hindu festival of Diwali, which falls on Nov. 5 this year. The metal is bought during marriages as part of bridal trousseau. The season runs from November to December and from late March through early May.
"Every year the festivals have been louder and bigger," said Mitra.
Even so, imports by the nation in the three months ended June fell to 150 metric tons from 159 tons a year earlier, the council said. While the total demand was little changed at 164.5 tons, jewelry demand dropped 2 percent in the period.
Gold traded in New York has advanced 13 percent this year and is headed for its 10th annual gain. Futures reached a record $1,266.50 an ounce on June 21 and bullion for immediate delivery touched an all-time high of $1,265.30 an ounce the same day.
To contact the reporter on this story: Madelene Pearson in Mumbai on
mpearson1@bloomberg.net.
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