Indian gold demand was negligible this week as record high prices deterred buyers, while demand in top consumer China remained subdued as it returned from the Lunar New Year holidays.
"Buyers have disappeared-nobody wants to pay these high prices,” said Harshad Ajmera of wholesaler JJ Gold House in Kolkata.
Domestic gold prices hit an all-time high of 84,910 rupees ($970.72) per 10 grams this week. They have risen more than 10% so far in 2025 after rising more than 21% in 2024.
Indian dealers offered a discount of up to $31 an ounce over official domestic prices versus last week's $35 an ounce discount.
"Foreign banks aren’t bringing gold into the country, which is why only a very small amount is available in the market. Under normal supply conditions, discounts could have gone above $100 per ounce,” said a Mumbai-based dealer with a bullion importing bank.
Global bullion banks are flying gold into the United States to capitalize on the unusually high premium that U.S. gold futures are enjoying over spot prices.
In China, gold was offered at a discount of $7-$10 per ounce over spot prices.
"Prices are too high and people don't want to buy," said a Chinese trader.
Meanwhile, ANZ said in a note that "China's pledge to ease monetary policy and fiscal expansion to boost economic growth along with CNY volatility will boost demand for gold."
In Singapore, dealers quoted premiums of $0.2-$2.20 per ounce for bullion. Dealers in Hong Kong charged $1.6-$2 per ounce premiums .
In Japan, bullion was sold between a discount of $3 to a premium of $1.
Since prices are at historic highs, there was decent selling and profit-taking this week, two Japanese traders said.
The World Gold Council said that gold jewellery demand fell 11% in 2024 and expects it to remain under pressure this year due to high prices. - Reuters
