09.15.08
India gold jumps, buyers retreat but eye prices
http://in.news.yahoo.com/137/20080915/371/tbs-india-gold-jumps-buyers-retreat-but.html
India’s gold prices jumped on Monday in tune with overseas markets making buyers retreat, but major festivals next month could bring them back to the market with strong retail sales expected.
“People have already bought a lot of gold,” said Prithviraj Kothari, director of Riddisiddhi Bullions Ltd, a large wholesaler in Mumbai. “They will wait for 11,500 rupees per 10 grams.”
Foreign gold, that guides the local market, rallied more than 2 percent as investors rushed to safe assets after the bankruptcy of Lehman Brothers fuelled worries about the U.S. financial system.
Gold generally has an inverse relation with the dollar as the two compete for funds and financial worries usually drag the dollar down.
Dealers said demand for silver was good, but with banks out of stock, recycled silver at higher prices was meeting the traders’ needs.
“Banks are not interested in selling silver,” said Jayanti Lal of Mahavir Bullion Corp in Vijayawada.
Lal said the local market was selling silver at 18,500 rupees per kg, higher than foreign prices.
A dealer in a bank in Mumbai said the premiums on gold was at $3 to $4 an ounce and the delay in deliveries of stocks was up to 7 days.
