Gold prices in India jumped about ₹3,000 per 10 gram in April from the levels of about ₹44,000 at the start of the month amid positive global cues. On 16 April, the local gold futures were trading around ₹47,000 per 10 grams.
Gold hit a seven-week high in global markets, which, according to analysts, has been driven by supportive macro cues.
India is witnessing an unprecedented surge in coronavirus disease (Covid-19) cases and many states like Maharashtra, Delhi and Uttar Pradesh have imposed local curbs to contain the virus. The fresh coronavirus-induced restrictions have led to a decline in physical gold purchases in India.
"Retail demand has been falling in many regions due to restrictions on the movement of people," said Ashok Jain, proprietor of Mumbai-based gold wholesaler Chenaji Narsinghji, according to news agency Reuters.
On the other hand, China, the world's biggest gold consumer, has stepped up bullion imports with a revival in demand. Dealers in China were charging premiums of $7-$9 an ounce over benchmark spot gold prices as compared to $7-$10 an ounce last week.
China has also authorised domestic and international banks to import large amounts of gold into the country, reported Reuters. "I think what's keeping the premiums in check is the recent news about onshore banks being allowed to import more gold by the People's Bank of China," says Yingtao Jin, an analyst at StoneX Group.
Aruna Gaitonde, Editor in Chief of the Asian Bureau, Rough&Polished
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