Gold demand 'boosted in India'

Firming trends in global markets have seen demand for buying gold increase in India.

Traders and analysts have reported an increase in demand from levels which have consolidated somewhat in recent weeks, a factor which could prove supportive for gold prices as mines struggle to meet requirements.

Delhi Bullion Market president Surender Jain said people are increasingly looking to place their assets into the precious metal to protect themselves against further economic uncertainty.

"[The] weakening dollar has boosted demand for precious metals as safe investment," he said, adding that the demand is self-perpetuating in the current climate.

Figures released by the Gold Fields Mineral Service (GFMS) detailing the first quarter of 2008 showed global mine production fell by to an eleven-year low in 2007, while demand, particularly fuelled by the jewelry sector, grew by five per cent.

GFMS is the world's foremost precious metals consultancy, specializing in research into the global gold, silver, platinum and palladium markets. The organization is based in London.

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