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Gold Investments

India’s Appetite For Gold Is Voracious

By Gold Investments on September 2, 2008 | More Posts By Gold Investments | Author's Website

In light Labour Day trading yesterday, gold fell as Hurricane Gustav did not impact the Gulf of Mexico as severely as had been expected.

Gold has continued to fall in trading in London as oil prices have continued their recent slide and are down nearly 5% to near $105 a barrel (Light Sweet Crude Oil Future - Combined - OCT08) and the dollar has risen to a 7 month high against the euro (below $1.45) and the US dollar index has risen to a 10 month high.

International gold demand remains very strong particularly in India with its voracious appetite for gold. Reuters reports that India’s gold imports in August jumped 45 percent from a year ago as lower prices and upcoming festivals drove demand in the world’s leading consumer. “India imported about 69 tonnes of gold in August 2007. In July this year, it bought just 22 tonnes against 64 tonnes in the same month a year ago.”

“The lower prices came at just the right time for Indians wanting to buy ahead of a string of religious festivals, when gold buying is considered auspicious. Reflecting the increasing demand, the premium over international rates more than doubled from a month earlier.”

With physical demand internationally very robust and gold supply remaining anaemic at best as seen in Australian gold production plummeting in the 3rd quarter gold should remain well supported in the $780 to $800/oz region.

Today’s Data and Influences

Today sees the first of this week’s key US indicators, with the release of the manufacturing ISM.

Gold and Silver

Gold is trading at $802.60/802.90 per ounce (1030 GMT).
Silver is trading at $13.08/13.14 per ounce (1030 GMT).

PGMs
Platinum is trading at $1381/1391 per ounce (1030 GMT).
Palladium is trading at $289/295 per ounce (1030 GMT).

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