| Date: |
17-06-2015 |
| Subject: |
Gold imports rise 10.5% to $2.42 billion in May |
|
The country’s gold imports rose 10.5% in May from a year before as lower prices of the precious metal boosted demand.
Imports by India — the world’s second-largest gold consumer — stood at $2.42 billion in May, compared with $2.19 billion a year earlier, according to the latest official data. Gold prices have been down by roughly 10% from a year before.
However, the imports were lower than those in March and April, as jewellers had purchased the metal in massive volumes to cater to demand during the Akshaya Tritiya. Gold imports in March doubled to $4.98 billion from a year before, while in April, the purchases from overseas jumped 78.3% to $3.13 billion.
After a 47% plunge in 2013-14, India’s gold imports jumped almost 20% in the last fiscal to $34.3 billion from a year before, helped by a spurt in jewellery demand following a drop in prices and the relaxation of curbs on supplies by the central bank.
The drop in the gold prices since early 2014-15 prompted people to buy jewellery, although demand for bars and coins declined last fiscal as investors feared a further slump in bullion rates. After allowing more players to import gold last year, the RBI had in November scrapped the 80:20 rule, under which at least 20% of the imported gold had to be exported before bringing in new lots.
The central bank followed it up with more clarifications in February on the operational aspects of gold purchases from overseas and allowed banks to import gold on a consignment basis — under which they act as intermediaries and don’t pay for the precious metal stocks until they find buyers. These factors boosted gold imports.
The World Gold Council has forecast Indian gold demand to be in the range of 900 and 1,000 tonne for this year, compared with 843 tonne in 2014.
In 2013-14, the imports were adversely affected by these measures by the govenrment and the central bank, including a 10% customs duty on the precious metal and tougher conditions for fresh imports under the so-called 80:20 rule to contain the current account deficit.
However, the CAD eased to 1.3% of gross domestic product in the last fiscal, lower than 1.7% a year earlier and a record 4.7% in 2012-13, which had stoked the series of crackdown against gold imports subsequently.
Source : financialexpress.com
|