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India’s October gold import to reach 9-month high

Oct 20, 2016, 6:51 AM EDT
(Source: bluelotus92/flickr)
(Source: bluelotus92/flickr)

India, the world’s second largest consumer of gold after China, is likely to witness a 9-month high in its gold import in the festive month of October, as the country’s banks and refiners place more orders after a slide in domestic prices of the yellow metal. Observers expect India’s October gold import to reach 60-70 ton, which will be the highest since January and about double the initial estimates of 30 ton predicted in September.

Festivals such as Diwali and Dussehra and the arrival of wedding season shoot the gold prices up in the fourth quarter in India, reports Reuters. Experts say that Indian buyers have also been encouraged by a correction in local gold futures.

However, there are concerns that a goods and services tax likely to introduced in India in next April may bring down the consumption, usage, saving and investment in gold, writes Bloomberg. According to a data, the consumption of gold jewelry in the first of this year remained the lowest since 2009, which was an outcome of a surge in prices, weaker rural incomes and government regulation. 

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