Gold sales rings across counters in China & India
Entering the market at an appropriate time is making jewellers in India jittery, but gold consumers across China and India, can't get enough of the yellow metal.
Posted: Tuesday , 23 Apr 2013
MUMBAI (MINEWEB) -
It is a shopping spree, the likes of which have not been witnessed in a long time. The dip in gold prices is turning out to be a boon for people in China, Hong Kong and India.
While China's news agency Xinhua reported that gold bars and accessories have sold out at more than one retailer in downtown Beijing, business portal ifeng.com reported that an enthusiastic customer spent over 1 million yuan to buy 40 gold bars worth 100 gram at China National Gold Group's Nanjing branch on April 16, the day gold price collapsed.
The China National Gold Group has said it has also bagged advance orders for gold totalling 50 kilograms over Monday and Tuesday, (April 15-16), equal to one month's sales.
In India, April 14 proved to be a good day for a retailer in Chennai, in South India, who sold close to 27 kilo, four times the normal sales. In a televised interview, he said if trend continues, and if there are no supplies this week, the jewellery store is expected to run out of stock.
The spurt in jewellery sales over the last few days has left the display racks in many stores in Mumbai and other parts of the country, looking bare.
However, investors in China were warned that the price of gold is set to dip further. Wang Ruilei, chief analyst at Boyin Precious Metal Investment Company told the Global Times that the price of gold is expected to fall further to as low as $1,150 an ounce. He has asked investors not to jump in and buy gold as yet.
Reports also indicate that many investors have crossed to Hong Kong overnight to purchase gold. Several Hong Kong gold e-tailers on taobao.com, considered China’s eBay, have also stopped selling gold jewellery, since most are out of stock.
Global Times also reported that a total of 20 kilo of gold worth more than 6 million yuan was sold out within two hours on April 13, at the Beijing Guohua Department Store.
At another store in Nanjing, East China, one local resident rushed to buy 10 kilo of gold worth about 2.9 million yuan, the Xiandai Express reported.
In India, the decline in gold prices is set to bring on a slump in gold imports by about 25% in April, and would hover around 53.25 tonne, as compared to April 2012's import of 71 tonne, according to Bombay Bullion Association president Mohit Kamboj.
He said imports would drop given the steady decline. "When prices drop, traders hold back in anticipation of a further decline. Most retailers and bullion traders are in that position now - very, very confused. They start buying when prices start to rise. Most fear that an additional increase in rates would harm their business," he said.