Financial Daily from THE HINDU group of publications
Wednesday, Dec 18, 2002
Financial Daily from THE HINDU group of publications Wednesday, Dec 18, 2002 |
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Precious Metals Agri-Biz & Commodities - Precious Metals Panic buys as gold begins to glitter Our Bureau
CHENNAI, Dec. 17 GOLD prices continued to skyrocket, touching near a six-year high of Rs 5,520 per 10 gm in Mumbai on Tuesday in the domestic market amidst reports of panic purchases by dealers. Selling, on the other hand, has come to a halt with sellers hoping for prices to firm up further. "The prices have been zooming during the last 10 days and dealers are making panic purchases fearing that each passing day could see gold scaling new highs," a bullion dealer said. "No one is currently coming forward to sell because they are looking for the prices to head higher. On the other hand, there is seasonal demand," Mr C.V. Pandurangan, Vice-President, Madras Jewellers and Diamond Merchants Association, told Business Line. Though the marriage season is set to begin only around mid-January in South India, customers usually buy at least a couple of weeks in advance. Demand, especially ahead of the marriage season, is seen firming up towards the end of the month in the other parts of the country. "Selling has almost come to a standstill. Every seller is now hoping that prices will rise further," he said. This phenomenon is in total contrast to the one witnessed earlier this year, when consumers opted to sell when gold touched $300/oz. The domestic market is following in the footsteps of the global market where weakness in the dollar, blazing crude prices and fears of a US attack on Iraq have catapulted the yellow metal to a 5-1/2 year high of $341 an ounce before slipping a tad to $340.25/341. The fears of an attack by the US and its allies on Iraq has especially led to the bull run since gold is seen as a safe-haven asset.
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