India's festive gold buying spree continues, defying record price

Tribhovandas Bhimji Zaveri

30/10/2024 01:00

(Repeats story that ran on Tuesday, with no changes)
    By Rajendra Jadhav
       MUMBAI, Oct 29 (Reuters) - Indian buyers of gold brushed
off record high prices and made purchases for the Dhanteras and
Diwali festivals starting on Tuesday, hoping bullion would
continue to rally and deliver promising returns amid a cooling
stock market, industry officials told Reuters. 
    Robust demand in the world's second-biggest gold consumer
could further support global prices  XAU= , which hit record
highs last week. Rising demand for imports of gold could also
widen India's trade deficit and put pressure on the rupee
 INR=IN .
    "People are still into gold big time, even with prices at
record highs during Dhanteras. With gold giving better returns
than the stock market, there's been solid demand for coins and
bars," said Saurabh Gadgil, chairman of PNG Jewellers  PNGD.NS .
    Indians were celebrating Dhanteras on Tuesday, a day
considered auspicious for buying gold and one of the busiest
gold-buying days in India.
    Local gold prices  MAUc1  jumped to a record high of 78,919
rupees per 10 grams last week, marking an increase of more than
31% since last year's Diwali. India's NSE Nifty 50 share index
has dropped about 7% from a record high hit on Sept. 27.
    Investors are working to diversify their portfolios by
adding to or increasing their allocations in gold and silver,
Gadgil said.
    "In value terms, turnover during this year's Dhanteras is
expected to be significantly higher than last year due to higher
prices. In volume terms, it may be slightly lower or around the
same level as last year," Prithviraj Kothari, president of the
India Bullion and Jewellers Association (IBJA), said.
    Indian dealers on Tuesday charged a premium  XAU-IN-PREM  of
up to $1 an ounce over official domestic prices – inclusive of
6% import and 3% sales levies, up from the last week’s discount
of $4.
    Local silver futures  MSVc1  hit a record high of 100,081
rupees per kilogram last week. 
    "Demand for silver coins and bars was strong today, as
silver has delivered better returns than gold in recent months,"
said Chirag Thakkar, CEO of Amrapali Group Gujarat, a leading
silver importer.

(Reporting by Rajendra Jadhav; Editing by Susan Fenton)
((mailto:rajendra.jadhav@thomsonreuters.com; Reuters Messaging:
x.com/Rajendra1857))