Chinese New Year spurs gold demand in China and Singapore, while India discounts widen
PHYSICAL gold demand in most of the top Asian hubs firmed this week as the approaching Chinese New Year encouraged buyers in China and Singapore, while discounts widened in India as jewellers stayed on the sidelines awaiting bigger price dips.
In top consumer China, premiums rose to US$45 to US$51 per ounce over spot prices from last week’s US$37 to US$45 premiums. Hong Kong dealers charged premiums of US$0.75 to US$3.25 per ounce.
“Chinese demand remained resilient...while we are noticing a pick-up in physical demand in Singapore ahead of Chinese New Year,” said Hugo Pascal, precious metals trader at InProved.
The Chinese New Year, a key occasion to buy gold, is from Feb 10 to 17.
In Singapore, dealers sold gold on par with international spot prices to a US$2.50 premium this week.
“We see more buying and clients are buying mainly festive bars because the Chinese New Year is coming up and, of course, this year is auspicious year as it is the Dragon year,” said Brian Lan at Singapore dealer GoldSilver Central.
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Meanwhile, dealers in India offered a discount of up to US$13 an ounce over official domestic prices, inclusive of the 15 per cent import and 3 per cent sales levies, up from last week’s discount of US$11.
“Although prices have corrected now, buyers are still holding back, waiting to see how much further they might fall,” said Harshad Ajmera, proprietor of JJ Gold House, a wholesaler in the Indian city of Kolkata.
Domestic gold prices traded around 62,200 rupees per 10 grams on Friday (Jan 12), down from the record high of 64,460 rupees hit last month.
Jewellers are holding back on purchases due to elevated prices and uncertainty regarding a potential uptick in demand, said a Mumbai-based dealer with a private bullion importing bank.
In Japan, dealers sold gold at on par to a US$1 premium. REUTERS
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