Contango ORE stock plummets as costs rise at Manh Choh mine
The cost rise relates to an overall reduction in the amount of ore being transported annually by approximately 20%.
* China, Hong-Kong markets quiet
* Yen-denominated gold hits over 1-year peak
* India discounts narrow to $1 from $6 earlier this week
* India’s gold market
Physical gold demand in Japan slackened this week as prices rallied, while a market correction towards the latter half of the week lured some buyers back in India and Singapore.
In Japan, the metal was sold at a discount of about 75 cents to the global benchmark price compared with 50 cents last week as demand was very weak, a Tokyo-based trader said. Gold priced in yen hit its highest since January 2018 this week.
A rally in domestic prices have reduced physical gold demand in Japan, with retailers selling bullion to take advantage of higher prices and a weaker yen, said Abhishek Bansal, chairman of Mumbai-based brokerage ABans Group.
“Physical demand for gold is likely to be impacted by the local prices along with retail sentiment. With the wedding season in India still ongoing, we can expect some demand to remain in the market.”
In India, dealers were offering a discount of up to $1 an ounce to official domestic prices on Friday, down from $6 on Wednesday, and compared with last week’s $5 discount range. The domestic price includes a 10 percent import tax.
This is a good time for people looking to buy gold, especially businesses
“Many buyers were waiting for the correction. As prices have come down, they are making purchases,” said Ashok Jain, proprietor of Mumbai-based gold wholesaler Chenaji Narsinghji.
In the spot market, gold traded around 34,370 rupees per 10 grams on Friday after rising to 34,900 rupees earlier this week.
Jewellers were buying due to improved retail demand, a Mumbai-based dealer with a bullion importing bank said.
“But banks’ requirement is limited as they are getting a decent amount of old jewellery,” the dealer said.
In China, the world’s biggest gold consumer, premiums were unchanged from the previous week at $7-$10 an ounce as demand remained relatively quiet, traders said.
“With Chinese market activity picking up after the Lunar New Year lull, we can expect better demand in the coming days,” ABans Group’s Bansal said.
Premiums in Hong Kong were also the same as last week in a range of 50 cents to $1.30 an ounce. In Singapore, premiums were unchanged at 50-80 cents over the global benchmark.
“This is a good time for people looking to buy gold, especially businesses. With the pullback in prices, wholesale buyers started to come into the market to buy some physical gold,” Brian Lan, managing director at dealer GoldSilver Central in Singapore.
Global benchmark spot gold hit a 10-month high of $1,346.73 on Wednesday, but retreated since on signs of another interest rate hike by the U.S. Federal Reserve this year.
(By Swati Verma, Karthika Suresh Namboothiri and Rajendra Jadhav; Editing by David Evans)
