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Suresh P. Iyengar

Mumbai, Dec. 2 Gold imports continued to fall in November due to the sharp rise in prices and depreciation in value of rupee against the dollar.

Imports fell 26 per cent to 40 tonnes in November against 54 tonnes recorded in the same period last year.

Mr Suresh Hundia, President, Bombay Bullion Association, said gold imports will range between 35 and 40 tonnes.

“Since the bullion exchange was shut for the last three days in November after the terrorist attack, we could not ascertain the exact import figures, but it will range between 35 and 40 tonnes,” he added.

Gold prices in the international markets were very volatile leading importers to adopt a wait-and-watch policy. In the London Metal Exchange, spot gold rose 13 per cent to $818 an ounce in November.

In India, prices rose 10 per cent to Rs 13,250 for 10 grams from Rs 11,830 mainly due to uncertain economic growth. Rupee value against dollar fell from 39.32 on November 1 to Rs 39.67 on November 30.

More than the high gold prices, the investor sentiments were affected by the gloomy global economic outlook and the possible impact on India.

Mr Harish Galipalli, Head of Research, Karvy Commodities, said gold till recently which was considered as a safe heaven, seemed to be loosing its stature due to its volatility.

The demand, which was slowing down during the second half of November, turned almost zero following the terrorist attack on Mumbai, said Mr Hundia.

With big corporates resorting to retrenchment of employees in the face of rising production cost and softening demand, analysts do not see a rebound in demand any time soon.

“The latest terrorist attack in Mumbai will turn investors become caution and the volatile gold prices will only make things difficult,” said an analyst.

More Stories on : Gold & Silver | Exports & Imports

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