Buying picked up from some Asian countries after gold retreated below USD 1,600 an ounce, and India's demand is expected to improve in April at the start of a new fiscal year, after the government held off from further curbs on gold inflows,
Spot gold hovered around USD 1,580 an ounce on Friday, after falling 5 percent in February in its fifth month in the red, the metal's longest stretch of monthly declines in 16 years, as an improving economic picture dulled gold's safe-haven appeal.
As speculators exited gold, Asian users seized the opportunity to buy the material at cheaper prices.
"When prices are below USD 1,600, demand from jewellers has recovered a little, though investors are either selling or sitting on the sidelines," said Dick Poon, general manager of Heraeus Metals in Hong Kong.
The onshore gold prices in China, the world's second-largest gold consumer after India, stood at about USD 20 above spot gold, attracting bargain seekers.
"We see huge orders from China, which are even bigger than the size of buying before the Lunar New Year," said a Singapore-based dealer.
Demand from Indonesia was also robust, thanks to a stronger rupiah that kept domestic prices low.
"The amount of buying from Indonesia in February almost doubled from January," said the Singapore-based dealer.
In Hong Kong, a main conduit for gold flow into China, premiums on gold bars were little changed from a week earlier at USD 1.50- USD 1.80 an ounce over spot prices.
In Singapore, premiums were steady at USD 1.20 an ounce, but could rise next week as a result of higher demand in the region, dealers said.
A day after India unveiled its budget for the fiscal year to March 2014, which included no further measures to curb gold imports, buying was slow in the world's top gold consumer, but hopes were high it would pick up with the start of the new fiscal year next month.
"We are happy with the budget," said Bachhraj Bamalwa, chairman of the All India Gems and Jewellery Trade Federation from Kolkata.
"We were expecting something wrong to happen in the form of another hike in import or excise duty. Today is the first day after the budget, we are not expecting great sales in March due to the fiscal year end, but April sales should increase due to weddings."
WEEK AHEAD
Physical gold buyers are waiting to see whether withering investment demand in gold could drag prices to last week's low near USD 1,550 an ounce, which could trigger further purchases.
No comments:
Post a Comment