Gold premiums ease as supplies rise

Last Updated: Thu, May 23, 2013 11:19 hrs

Indian gold futures jumped more than a percent on Thursday aided by a weaker rupee and firm global trends, while premiums on physical gold eased due to some supply from bullion importing agencies.

The Reserve Bank of India restricted banks from consignment imports of the yellow metal, except for jewellery exporters, after imports in April jumped more than 150 percent, despite a 50 percent hike in import duty in January.

"Supplies are good now from the nominated agencies, premiums have come down to $4-5 (an ounce)," said Mayank Khemka, managing director with Khemka Group, a bullion wholesaler. Premiums jumped to as high as $15 an ounce last week.

Nominated agencies like MMTC, State Trading Corp. and PEC are controlled by the trade ministry.

The actively traded gold for June delivery on the Multi Commodity Exchange (MCX) was 1.41 percent higher at 26,330 rupees per 10 grams.

Global gold climbed off session lows on Thursday after weak Chinese factory activity jolted stock markets in Asia.

The rupee, which hit its lowest level in more than eight months, plays an important role in determining the landed cost of the dollar-quoted yellow metal.

Silver for July delivery on the MCX was 0.33 percent lower at 43,367 rupees per kilogram.

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