Festival to boost gold import
Oct. 28: India’s gold sales during October 31-November 6, when the country celebrates Dhanteras and Diwali festivals, may rise by up to 40 per cent on year, in turn supporting the outlook for record imports in 2010, a senior World Gold Council (WGC) official said on Thursday.
On November 3 is Dhanteras — when jewellers in India register the highest gold sales in a year — and on November 5 is Diwali — when they buy the yellow metal as a sign of future prosperity.
“It’s now an economic decision. The urge among consumers is to capture gold now than later as prices have continuously rallied upwards,” Mr Ajay Mitra, managing director of World Gold Council India and the Middle East told Reuters in an interview.
WGC expects demand this year from north India, the region that consumed 16.8 tonnes of gold last year for Dhanteras, to be better than the western region. Western India accounted for 19.6 tonnes of the precious metal last year of the total 56 tonnes.
“The clinching argument, as signalled by the Reserve Bank of India’s (RBI) purchase of gold is, there is nervousness, and there is uncertainty in terms of other assets’ performance and how the currency markets would be shaping up,” said Mr Mitra.
The Reserve Bank of India had bought 200 tonnes of gold in an off-market transaction from the IMF for $6.7 billion at an average price of about $1,045 an ounce at the end of 2009. It made the central bank’s gold holdings the 11th largest among its peers.
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