Gold Fever? Statistics Reveal India Imported Bullion like Crazy in May

Vast imports of gold coincided with rising prices in India this May and caused the market to be flooded with scrap gold and retailers to resort to discounts, according to a Reuters report.

India, the world’s second-biggest consumer of gold, bought almost 50% more gold in May than it did a year earlier, Scrap Register reported Friday. According to the report, India imported 116 tonnes of gold, compared to 78 tonnes a year earlier. In value terms, India’s gold imports rose to $4.78 billion in May 2019 from $3.48 billion a year ago, according to an anonymous government official.

According to Scrap Register report, the heightened imports were dictated by local festivities that led to a surge in retail gold demand. Retail gold prices increased by 1,000 rupees ($14,41) per 10 grams, hitting 32,834 rupees level ($473) per 10 grams, according to Reuters report.

The market is currently in recoil, with retail demand very low due to high prices and retail sellers making discounts, a Reuters report says. Throughout the week, dealers offered 50 cent discounts per ounce compared to official prices, compared to a 50 cent premium last week.

Heightened prices on gold motivated customers in India and China — the world’s biggest consumer of gold — to sell their gold, flooding the market with scrap, according to Reuters.

In 2018, India imported a total of $31.8 billion worth of gold, while China bought $45.8 billion. Both countries were topped by Switzerland, who bought a total of $63.3 billion worth of gold, singlehandedly accounting for 22 per cent of the world’s gold imports, according to statistics provided by World Top Exports chart.