Rising gold prices may affect imports

The high rising gold prices could affect import of the metal in India and local consumer demand, as reported in a leading Indian daily. The price of gold in the overseas market reached $1,095.4 an ounce, amidst the falling dollar prices on Wednesday. Although the Reserve Bank of India has purchased 200 tonnes of gold from the IMF only two days ago, prominent retailers of gold jewellery have been reportedly observing a lowered footfall into their retail stores.

According to market analysis, the prevailing consumer buying attitude is both compulsive and one of restraint. As the festive and wedding season is at its peak in the country, the compulsive buyer is making purchases, but otherwise purchases have reduced.

Reports also add that gold imported into India in the period between January to December 2008, was 459 tonnes, but import in the same 12 months this year is estimated to be not more than 300 tonnes.