GOLD - MUMBAI. Jewellery stores in India wore a deserted look this week after a record rally in prices hammered appetite and forced dealers to offer steep discounts, but top consumer China continued to see steady demand.
In tandem with a surge in benchmark spot gold prices, domestic rates in India, the world's second-largest gold consumer, hit an all-time high of 66,943 rupees per 10 grams this week.
"Retail demand is nearly non-existent. Buyers have become very discerning and prefer to make purchases only when prices come down," said a Mumbai-based jeweller.
Dealers hiked discounts to about $38 an ounce, the highest since March 2023, over official domestic prices --inclusive of 15% import and 3% sales levies -- from $36 last week.
"Jewellers are feeling shaky about sales in coming months, so they're not even bothering to ask banks for supplies and how much discounts they're offering," said a Mumbai-based bullion dealer with a private bank.
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In China, gold premiums were steady at $15-$25 per ounce over benchmark prices.
The rally hasn't tarnished Chinese gold appetite, Hugo Pascal, precious metals trader at InProved said.
China's central bank has been steadily building its gold reserves.
"The People Bank of China's recent gold purchases had a significantly positive impact on its reserve assets diversity," said Bernard Sin, regional director, Greater China at MKS PAMP.
In Japan, investors stayed on the sidelines after the Bank of Japan announced a historic shift from negative short-term rates, said a Tokyo-based trader, with gold sold at par to $0.5 premiums.
In Singapore, bullion was sold at anywhere between $1.50 to $3 premiums and at $0.5-$3 premiums in Hong Kong.
"(In Singapore) Lots of clients are taking profit, selling their gold or even jewellery," said Brian Lan at dealer GoldSilver Central, adding some smaller clients opted for silver as a better bet.
