Singapore: Purchases from jewellerymakers in main gold in India have given some shine to the physical market in Asia, but wary investors chose to stay on the sidelines and wait for global financial markets to calm down.
Demand from jewellers is steady, although gold has rebounded more than 3% since dropping to a seven-week low around $641 (Rs26,281) an ounce last week.
Spot gold rose to $663.10/663.80 on Thursday, from $659.40/660.20 in New York.
“Physical demand has been reported in India and the Middle East, especially in the form of jewellery,” said Pradeep Unni, an analyst at Vision Commodity Services in Dubai.
Indian jewellery consumption rose to 240 tonnes in the second quarter of 2007, from 127.3 tonnes in the same quarter in the year-ago period because of a less volatile price, said the World Gold Council.
Purchases from jewellers and the industrial sector pushed up premiums for gold bars in Hong Kong to 40 cents an ounce to the spot London price. Gold premiums stood at 20 cents last week. Bullion plunged to its lowest in seven weeks to $641.10 on 16 August, when investors sold precious metals for cash to cover margin calls on losses triggered by a dip in the US subprime mortgage market.