MUMBAI (Thomson Financial) - India spot gold eased from its all-time high
hit earlier today, but ended above the 12,000-rupee mark on global cues even
though these record prices are seen denting the country's imports.
In London, gold slipped on profit-taking after it rallied to highs of
929.15 usd an ounce yesterday as crude oil prices closed over 100 usd a barrel,
stoking inflation concerns. The rally was aided by the weakness of the US dollar
against major currencies.
Last month, the yellow metal hit a record high of 936.60 usd an ounce on the
back of a soft US dollar and mining disruptions in South Africa.
"We expect (Indian) imports for the month of February to be at around 4-5
tonnes from 54 tonnes recorded last year looking at these record high prices,"
said Suresh Hundia, president of the Bombay Bullion Association.
The recent rally in domestic gold prices was also supported by a weaker
rupee apart from strong global cues, Hundia added.
Meanwhile, according to an estimate from the Bombay Bullion Association, the
country's gold imports slumped to 5 tonnes in January compared with 62 tonnes
last January, as surging prices put the metal beyond the reach of most
consumers.
India imported 722 tonnes of gold in 2006.
Manqoba Madinane, commodity analyst at Standard Bank in Johannesburg told
Thomson Financial News: "We will see gold rising going forward on rising
investment appeal of the yellow metal and expectations of a rate cut by the
Federal Reserve."
Madinane however added that there would be bouts of corrections on the way
up largely due to lack of jewellery demand from India and also on increase in
recycled gold supplies on record high prices.
The World Gold Council recently said in a report that the country's
jewellery demand for the fourth quarter to Dec 31 slumped to 54 tonnes compared
with 165.4 tonnes a year earlier, as prices were volatile and reached record
highs of over 10,000 rupees per 10 grams.
Today Mumbai gold of 0.995 purity closed 355 rupees higher at 12,005 rupees
per 10 grams, while gold of 0.999 purity closed 355 rupees higher at 12,060
rupees per 10 grams.
Silver of 0.999 purity closed 530 rupees higher at 22,135 per kg.
Siddesh Mayenkar; tfn.newsdesk@thomson.com
sim/jro/ajb
COPYRIGHT
Copyright Thomson Financial News Limited 2007. All rights reserved.
The copying, republication or redistribution of Thomson Financial News Content,
including by framing or similar means, is expressly prohibited without the prior
written consent of Thomson Financial News.
|