The Hindu Business Line : Gold coins demand sluggish on price volatility

Mumbai, Oct. 29 Demand for gold coins ahead of Diwali is sluggish as wild swings in prices are prompting buyers to put off their purchase decisions, say bankers.

“This year we have seen one of the worst demand swings due to price volatility that is not common,” said Mr Anshuman Sharma, Head – Precious Metals at Axis Bank. “One day the price is Rs 9,800 per 10 gm, the next day it is Rs 10,100 per 10 gm. A purchaser cannot make a decision amidst such volatility,” he added.

Retail demand is picking up, however, the wholesale demand is sluggish, said Mr Moses Harding, Head of precious metals at IndusInd Bank.

Corporate gifting

Emergence of gold coin demand for corporate gifting purpose is picking up, said Mr Sudip Bandyopadhyay, Director & CEO of Reliance Money that has just supplied gold coins to Sansui for corporate gifting.

Going forward, gold prices will be determined by the dollar movement and forthcoming US Federal Reserve meet on October 31, said Mr Harding.

In the last one and half month, gold prices have seen huge increases. In the last week, they gained over Rs 100 per 10 gm day-on-day.

Gold prices surged to Rs 10,135 per 10 gm in the local market in Mumbai on Monday.