Dwindling gold demand pushes Chinese discounts to record high
By Arpan Varghese and Rajendra Jadhav BENGALURU/MUMBAI (Reuters) - Chinese discounts for physical gold scaled yet another record peak versus global spot rates this week as the COVID-19 pandemic continued to choke retail appetite, with even a price dip failing to lure consumers in India.
By Arpan Varghese and Rajendra Jadhav
BENGALURU/MUMBAI (Reuters) - Chinese discounts for physical gold scaled yet another record peak versus global spot rates this week as the COVID-19 pandemic continued to choke retail appetite, with even a price dip failing to lure consumers in India.
Gold has been sold at discounts in China, usually the world's top bullion consumer, since February.
Discounts widened to between $75 and $100 an ounce over the global benchmark, up from last week's $70-$60.
"Even with a price dip, there's hardly any consumer demand," said Peter Fung, head of dealing at Wing Fung Precious Metals.
Benchmark prices are now around $1,948 an ounce, having retreated from the record high of $2,072.50 on Aug. 7.
While jewellery fabricators did buy more ahead of an Aug. 25 festival, selling was stronger, said Samson Li, a Hong Kong-based analyst at Refinitiv GFMS.
Hong Kong dealers were operating between a discount of $0.60 an ounce up to a premium of $1.50.
India's gold futures eased to about 52,400 rupees per 10 grams on Friday, from a record 56,191 rupees last week.
"Jewellery demand was subdued for weeks. Now even investment demand has fallen due to price volatility," said Ashok Jain, proprietor of Mumbai-based gold wholesaler Chenaji Narsinghji.
Premiums eased to about $2 an ounce over official domestic prices, which incorporates import and sales levies, from $4 last week.
"Buyers are more cautious now and factor in a possible drop as well," said one Mumbai-based dealer with a bullion-importing private bank.
Bangladesh cut domestic gold rates to 73,716 taka ($871.04) per Bhori (11.664 grams) from a record 77,215 taka ($912.38) last week amid weak demand.
In Singapore, however, consumers used price dips to buy gold and silver.
"The run-up in prices for both metals has generated much interest with retail investors," said Vincent Tie, sales manager at dealer Silver Bullion.
Premiums of $1-$1.50 an ounce were charged in Singapore.
(Reporting by Brijesh Patel and Arpan Varghese in Bengaluru and Rajendra Jadhav in Mumbai; Additional reporting by K. Sathya Narayanan and Ruma Paul in Dhaka; Editing by David Goodman)
This story has not been edited by Firstpost staff and is generated by auto-feed.
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