Money News

India gold demand low, buyers await falls

A worker shows gold biscuits at a precious metals refinery in Mumbai March 3, 2008. REUTERS/Arko Datta

MUMBAI (Reuters) - Indian gold demand remained weak on Friday due to high prices and on absence of any festivals, dealers said.

“People are now very cautious when they come to buy gold jewellery,” said Ashwin Choksi, partner, Jamnadas M. Choksi Jewellers.

Buyers are also waiting to see if the rupee, that had weakened against the dollar, would recover further, helping ease local gold prices, he said.

Most of India’s gold is imported and a weak rupee pushes prices of the metal higher.

Traders are also hoping for good monsoon rains to push up demand for gold, said a dealer with a large private bank.

India’s gold demand may remain sluggish for the next few months and is expected to revive in September, when festivals commence, he said.

Purchases for jewellery and investment fell 50 percent in the first quarter of 2008 in India due to high prices, the World Gold Council has said. India’s jewellery and investment demand stood at 71 tonnes and 31 tonnes, respectively.