According to traders, gold premiums in India, are trading about 8% over London prices currently on the back of a shortage of supplies needed to match festival demand.
Author: Siddesh Mayenkar (Reuters)
Posted: Wednesday , 16 Oct 2013
MUMBAI (REUTERS) -
Gold premiums in India, the world's biggest buyer of the precious metal, hit a record $100 an ounce, about 8 percent over London prices, on a shortage of supplies to meet festival demand, traders said on Tuesday.
Banks, the primary dealers of bullion, are currently importing the yellow metal chiefly for exporters, as under the so-called 80/20 principle, jewellery exporters get priority for supplies over domestic manufacturers.
The principle, part of a package of measures announced in July aimed at cutting India's current account deficit by reducing gold imports, states that 20 percent of all gold imported into India must be re-exported.
"There are no supplies in the domestic market, and there ...