India Recorded 14% Decline in Sep '18 Gold Imports

SEATTLE (Scrap Monster): The provisional data published by GFMS indicates substantial drop in gold imports by the country during the month of September this year. When compared with the prior year, the imports dropped by almost 14%.

The declining value of rupee led to rally in domestic gold prices, which dented the demand. The sharp decline in Indian gold demand is likely to impact global gold prices, which have already dropped by nearly 9% since the beginning of 2018. Meantime, the lower import volumes may help the country to rein in on rising trade deficit situation.

According to industry experts, the Indian gold demand which peaked in August, witnessed slowdown during the previous month, mainly on account of higher prices. It must be noted that the country’s Aug ’18 gold imports had hit highest levels in nearly 15 months, totaling 85.7 tonnes. Higher imports meant that jewelers had enough inventories going into September. Moreover, the weak demand ensured that inventory levels didn’t drop much, thereby stemming further imports in September.

Bachhraj Bamalwa, ex-Chairman of the All India Gems and Jewellery Trade Federation (GJF) noted that festivals such as Dussehra and Diwali are likely to boost gold imports in October. Traditional wedding season demand coupled with year-end purchases will result in increased gold demand towards the end of the year. The investment demand has already started signs of recovery, following rout in stock markets, GFMS noted.