Gold premiums widen as jewellers stock up in anticipation of festival demand

MUMBAI: Gold premiums, or prices charged by suppliers in excess of the gold rate, have increased to $8-11 an ounce from $3-4 since early last week, as jewellers stock up on inventory ahead of the festival season amid signs of a gradual pickup in consumer demand, said Sudheesh Nambiath, senior analyst, GFMS Thomson Reuters, a precious metals analytical company.

Jewellers said that the decline in prices by around $27 an ounce over the past week also helped. Indian gold prices take their cues from the metal’s overseas rate as the country imports much of its consumption.

However, gold rose by 1 per cent to $1,289.06 an ounce as investors assessed the geopolitical impact of tensions in the Middle East and Ukraine.

On commodity exchange MCX, gold was up three fifths of a percent at Rs 27,950 ex-VAT. A stronger rupee limited the domestic rate rise in noon trades.