SEATTLE (Scrap Monster): The latest gold market report released by the World Gold Council (WGC) indicates that gold imports by the country surged higher during the month of May this year, amid improvement in gold retail demand.
According to Mukesh Kumar, Senior Analyst, India World Gold Council, the retail demand for the yellow metal remained strong during the initial three weeks of May, mainly driven by wedding and festival-related purchases. However, the demand slowed towards the end of the month.
The official gold imports by the country totalled 98 tonnes, significantly higher when compared to the prior month imports of 27.1 tonnes and imports of 11.4 tonnes during the corresponding month a year before. Meantime, higher inflation coupled with depreciating local currency drove gold ETF net inflow of 0.4 tonnes. The net gold ETF holdings increased to 38.9 tonnes by the end of the month. Also, the country’s central bank added 3.7 tonnes of gold to its holdings during the month, thus boosting the total gold reserves to 765.1 tonnes, WGC noted.
Looking ahead, WGC expects retail demand to remain soft in June. It must be noted that the local gold market has remained in discount during the initial weeks of June, thereby suggesting soft demand and sufficient inventory levels.