Gold spike dims demand, futures trade at discount

Hobbled by surging prices in the past week, Indian gold jewellery buyers have tightened their purse-strings in the hope that prices will ease in the coming weeks ahead of auspicious gold buying occasions.

- Ram Sahgal

MUMBAI:

This has come at a time of unbridled volatility in global financial markets, with questions being raised over the dollar's pre-eminence as a safe-haven asset.

The drop in demand, estimated at 40-50% across industry by certain quarters, was brought on by the prices of the yellow metal shooting up more than 6% last week and 30% in the past year, according to data from Bloomberg. To be sure, jewellery companies are hopeful that the demand drop will be offset by the rise in prices.