|Chennai||Rs. 24470.00 (1.37%)|
|Mumbai||Rs. 24900.00 (0.97%)|
|Delhi||Rs. 24200.00 (1.26%)|
|Kolkata||Rs. 24160.00 (0%)|
|Kerala||Rs. 24000.00 (0.63%)|
|Bangalore||Rs. 23800.00 (0%)|
|Hyderabad||Rs. 24140.00 (1.17%)|
Chinese gold imports are likely to swell further after rising strongly for a second straight month in March, as investors seek safety from economic uncertainty and after prices plunged to a two-year low last month.
"Physical demand picked up significantly over the last couple of weeks. Consumers and industrial users tend to see price drops as buying opportunities," Zhang Bingnan, secretary-general of the China Gold Association, told Reuters.
"Investment demand should continue to stay strong through the rest of the year because of limited investment alternatives," said Zhang, adding that gold sales and processing volumes both spiked in April.
He said China's gold consumption in the first quarter probably rose 10-15 percent from 255.2 tonnes in 2012.
Net gold flows from Hong Kong to China, the world's No. 2 gold consumer after India, rose to 223.519 tonnes in March from 97.106 tonnes in February, data from the Hong Kong Census and Statistics Department showed on Tuesday (www.censtatd.gov).
In March, Shanghai gold futures fetched premiums of more than $30 to global prices, making it cheaper to buy the metal overseas.
April could see imports swell further after the drop in international prices spurred frenzied buying in Asia, leading to a shortage of gold bars and coins in Singapore as well as Hong Kong, which is China's main source for gold imports.
Demand for gold from India and China is a major factor in global prices, with the World Gold Council saying the two countries account for more than a third of global appetite. China produced 403 tonnes of gold in 2012, but consumption was more than double at 832.2 tonnes.
Gold tumbled to around $1,321 an ounce on April 16, its lowest in more than two years, after a fall below $1,500 and fears of central bank sales led to a sell-off that stunned investors and prompted them to slash holdings of exchange-traded funds. It stood at around $1,460 on Tuesday.
"April imports will be stronger than March," said Ronald Leung, chief dealer at Lee Cheong Gold Dealers in Hong Kong. "The world was buying gold and China was no different at all."
The drop in gold prices has prompted a gold rush in China, with Chinese shoppers flocking to retailers to buy jewellery and gold bars.
A spokesman for Hong Kong jewellery chain Chow Tai Fook (1929.HK), the world's largest jewellery retailer by market value, told Reuters that traffic at its China stores jumped by 50 percent during the May Day holidays.
The surge in Chinese travellers during the three-day May Day holiday also drove gold sales in Hong Kong to rise by an estimated 50 percent, with total gold sales from April 29-May 2 reaching some 40 tonnes, local media quoted Haywood Cheung, president of the Hong Kong Gold and Silver Exchange, as saying.
The jump in Chinese physical demand also prompted some banks to ship in more supplies from London and Swiss vaults, traders said
With China's economy still on shaky ground, investors could increasingly be turning to gold as a so-called safe-haven investment.
China's annual export growth may have picked up slightly in April due to a low comparison from a year ago, while import growth probably eased, a Reuters poll showed, suggesting the underlying momentum for both the domestic and global economies remains tepid.
Gold exports to China from Hong Kong hit an all time high of 557.478 tonnes in 2012.