- Saturday, April 20, 2024
By: Shubham Ghosh
INDIA’S gold imports in the month of August almost doubled from that a year earlier to the highest in five months on strong demand and as weaker prices saw jewellers ramping up purchases for the festival season, a source in the Narendra Modi government said.
According to a report by Reuters, higher imports by the world’s second-largest bullion customer could back benchmark gold prices, which have corrected almost 12 per cent from an all-time high of $2,072 in August last year. The rise in imports could widen India’s trade deficit and put pressure on its currency.
India imported a total of 121 tonnes of gold in the month of August, compared to 63 tonnes in the same month a year earlier, a government source said on Monday on the condition of anonymity, the report added.
In value terms, the imports in August went up to $6.7 billion from $3.7 billion a year ago, the source added.
A price correction early in the month gave the jewellers a chance to build inventories for the upcoming festive season, a dealer from Mumbai with a gold-importing bank said.
Local gold futures decreased to Rs 45,662 per 10 grams on Aug. 10, the lowest in four months.
“Retail demand was good in August as coronavirus cases fell and people stepped out to shop,” said Harshad Ajmera, a gold wholesaler in Kolkata in the eastern state of West Bengal said.
India’s gold imports in the first eight months of 2021 tripled to 687 tonnes from the lower base of 2020, when the Covid-19 outbreak forced authorities to impose a nationwide lockdown, the government official added.
According to a bullion dealer in Chennai in the southern state of Tamil Nadu, India’s gold imports in September could go above 80 tonnes from 12 tonnes a year earlier if prices remain stable ahead of festivals, the Reuters report added.
