Gold prices in India have turned to a premium for the first time in over three months, driven by a recent price pullback that has spurred jewellery demand. As of Friday, domestic gold prices were around 148,200 rupees per 10 grams, after hitting a two-week low of 145,627 rupees earlier in the week. Chanda Venkatesh, managing director of bullion merchant CapsGold, noted that while jewellery demand is rising with the festive and wedding season, investors remain cautious due to continuing price declines.
Dealers in India quoted premiums of up to $7 an ounce over official domestic prices, a shift from discounts of up to $6 last week. Despite the typical increase in gold imports ahead of the festival season, inflows have been lower than usual this year, tightening domestic supplies. India’s gold imports in September fell sharply to $1.8 billion from $9.6 billion last year, according to trade ministry data. Additionally, several large Indian mutual funds suspended bulk subscriptions to gold exchange-traded funds late on Thursday.
In contrast, demand in China remained subdued, with bullion trading at premiums of $4 to $13 an ounce over the global benchmark. Bernard Sin, regional director at MKS PAMP, attributed the cautious buying to spot gold’s volatile price range. International spot gold prices edged higher but were on track for a marginal weekly decline. In Singapore, gold traded at premiums of $0.50 to $1.70, while it was flat to a $1.50 premium in Hong Kong. In Japan, gold was sold between a $0.25 discount and a $0.50 premium, with weak investment demand and retail purchases.