|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%)|
Premiums quoted for the physical delivery of gold have halved in about 15 days, coinciding with a nearly 5 per cent fall in prices. The premium of $120 an ounce prevailing a week before Diwali has come down to $60-$70 an ounce (roughly Rs 1,200 per 10g) in the Mumbai market.
Traders say in the run-up to Diwali, smuggled gold was sold in a big way, which led to a fall in spot premiums and, effectively, a fall in prices. The premiums fell at a time when international prices were on the decline. In effect, the fall in gold prices in the Indian market is more than that seen in the international market over the past fortnight despite rupee depreciation.
At one point on the day before Diwali, premiums were quoted at $30 an ounce but they rose again. On Saturday, the gold price at Mumbai's Zaveri Bazaar went up by Rs 10 per 10g to close at Rs 30, 790 as against Friday night's 1.5 per cent fall in price in the international market after strong US jobs data.
Premiums are still relatively high because official imports are low. In October, 23 tonnes of gold was imported - 13 tonnes of it by exporters -according to trade estimates.
Jewellers say domestic demand is low whereas the commerce ministry has sensed an unusual pick-up in export activity. The ministry has called a meeting of various stakeholders on Monday to discuss the export scenario and a possible tightening of norms amid reports of increased round-tripping of the precious metal. Exporters are said to be exporting mostly gold chains, the manufacture of which does not cost much. They sell at a loss, according to industry insiders, but make money by importing gold and diverting it to the domestic market.
At the ministry meeting, stringent value-addition norms for exports are likely to be proposed. At present, an exporter is required to add at least 3 per cent value for exporting jewellery, which may be raised to 5 per cent. Another proposal is to reduce the permitted level of wastage. When gold is converted to jewellery, some wastage takes place, which is deducted while calculating the value addition. Currently, 3.5 per cent wastage is allowed but only 2.5 per cent is genuinely wasted, say trade sources.