Gold import nearly halves to $3.90 bn in Apr-Jun; yellow metal at 2-week low 

New Delhi: Gold imports fell by about 48 per cent to $3.90 billion in the first quarter of the current fiscal of 2016-17, which is expected to keep a lid on the current account deficit (CAD). The sliding prices of the precious metal in both global and domestic markets are seen as a contributory factor for the plunge. Gold imports stood at $7.51 billion in April-June 2015.

The drop in gold imports is expected to keep a lid on the current account deficit (CAD). India’s CAD narrowed to 1.3 per cent of GDP in the third quarter of 2015-16 as against 1.5 per cent in the same period of the previous year, mainly on account of a lower trade deficit.

The inbound shipments contracted for a fifth consecutive month in June by 38.5 per cent to $1.20 billion, according to the data by the Commerce Ministry. The contraction in imports helped narrow trade deficit to $8.11 billion last month as against $ 10.82 billion in June 2015. India is one of the largest gold importers in the world and imports mainly take care of demand of jewellery industry. India’s CAD narrowed to 1.3 per cent of GDP in the third quarter of 2015-16 as against 1.5 per cent in the same period of the previous year, mainly on account of a lower trade deficit.

Meanwhile, the government has announced launch of fourth tranche of sovereign gold bond scheme from today in a bid to check the demand for physical gold. It had netted 3.1 tonnes of idle household and temple gold under the monetisation scheme since its launch in November. As per the data, silver imports too dipped to $249.39 million in June as against $342.37 million in the same month last year. Also, shipments of pearls, precious and semi-precious stones showed a decline of 13.52 per cent in June.

The prices of yellow metal hit 2-week low on Monday owing to global cues, subdued demand hurt. Gold continued to head downhill to close at Rs 30,550 per 10 grams by plunging Rs 200, in sync with a weak global market. Demand from jewellers at the domestic market remained soft, which kept the prices lower. Silver declined Rs 240 Rs 46,260 per kg due to reduced off-take by industrial units and coin makers.

On the other hand, the yellow metal hits 2-week low on Monday owing to global cues, subdued demand hurt. Gold continued to head downhill to close at Rs 30,550 per 10 grams by plunging Rs 200, in sync with a weak global market. Demand from jewellers at the domestic market remained soft, which kept the prices lower. Silver declined Rs 240 Rs 46,260 per kg due to reduced off-take by industrial units and coin makers.

Overseas, gold turned weaker after data on Friday showed the US economy gaining traction, raising bets that the Federal Reserve may increase interest rates this year. This diminished its demand as a safe haven, which weighed on sentiment here in India.

Overseas, gold turned weaker after data on Friday showed the US economy gaining traction, raising bets that the Federal Reserve may increase interest rates this year. This diminished its demand as a safe haven, which weighed on sentiment here, traders said.

Globally, gold traded one per cent lower at $1,323.83 an ounce in Singapore.
In the national capital, gold of 99.9 per cent and 99.5 per cent purity slumped by Rs 200 each to Rs 30,550 and Rs 30,400 per 10 grams, respectively, a level last seen on July 2.
The precious metals had shed Rs 50 in Saturday’s trade.

Sovereign, however, remained steady at Rs 23,400 per piece of 8 grams. Following gold, silver ready fell Rs 200 to Rs 46,260 per kg and weekly-based delivery cracked below Rs 47,000-mark by losing Rs 345 to Rs 46,930 per kg. In line with the overall movement, silver coins plummeted by Rs 1,000 to Rs 73,000 for buying and Rs 74,000 for selling of 100 pieces.

Source: PTI