Asia Gold-India discounts widen as pandemic dulls festive demand

  • Reuters
  • Commodities News
Asia Gold-India discounts widen as pandemic dulls festive demand
Credit: © Reuters.

* India discounts widen to $5/oz versus $3/oz last week

* Few buyers turn to online platforms to buy gold - Indian dealer

* Bangladesh Jewellers Association raises local gold rates

* Singapore premiums ease to $1.3-$1.9/oz vs $1.5-$2 last week

By Rajendra Jadhav and Sumita Layek

May 14 (Reuters) - Physical gold was sold at the biggest discount in over seven months in India this week as pandemic-led restrictions kept jewellery stores closed during a key gold-buying festival in the world's second biggest consumer.

"For the second straight year, Akshaya Tritiya sales plunged because of coronavirus," said a Mumbai-based bullion dealer with a gold-importing bank. "Retail sales are almost nil as jewellery stores are closed."

Akshaya Tritiya, considered an auspicious time to buy gold, was being celebrated on Friday, although most Indian states were under COVID-19-led curbs. rose to $5 an ounce over official domestic prices - the biggest since the week of Oct. 1 - inclusive of 10.75% import and 3% sales levies, versus last week's $3 discount.

Under normal circumstances, the festival rings in robust demand.

Few Indians were buying gold on online platforms as stores were closed, said Ketan Kothari, director at bullion dealer Augmont.

Meanwhile, the Bangladesh Jewellers Association raised local rates on all types of gold this week, tracking international markets, with the best quality gold priced at 71,442 taka ($842.2) per Bhori, or 11.664 grams.

The association also said there was a supply shortage due to tax-related complexities on imports and a shutdown of international flights.

In China, premiums of $7.5-$10 an ounce were charged over benchmark spot gold prices, little changed from last week's $7-$10. GOL/

"We've seen diminishing demand mostly due to the strength in the renminbi. I don't think the current range will trigger a buying spree or dishoarding," said Bernard Sin, regional director for Greater China at MKS Switzerland.

In Hong Kong, premiums of $1.8-$2 were charged versus $0.8-$1.8 last week.

In Singapore, premiums eased to $1.3-$1.9 from $1.5-$2 a week ago, with higher prices prompting some investors to sell the metal, a dealer said.

In Japan, gold was sold at flat to a $0.50 premium.

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