India's gold imports in August this year has nearly doubled from last year, and has been the highest in five months, a government source told Reuters. Compared to 63 tonnes of gold that India imported in 2020, this year the import has been around 121 tonnes.
In value terms, August imports surged to $6.7 billion from $3.7 billion a year ago, Reuters reported.
This could be due to a strong demand and weaker prices which have prompted jewellers to ramp up purchases for the upcoming festive season. The surge in imports could support benchmark gold prices, which have corrected nearly 12% from an all-time high of $2,072 in August 2020.
It could also lead to an increase in India's trade deficit and pressure the ruppee.
Local gold futures fell to Rs 45,662 per 10 grams on Aug. 10, the lowest in four months, Reuters reported.
India's gold imports in the first eight months of 2021 tripled to 687 tonnes from the lower base of 2020, when the coronavirus outbreak forced authorities to impose a nationwide lockdown.
The country's gold imports in September could rise above 80 tonnes from 12 tonnes a year earlier if prices remain stable ahead of festivals, a Chennai-based bullion dealer told Reuters.
Source:moneycontrol.com