GOLD DEALERS in India have stepped up Buying Gold in a last minute bid to increase stocks ahead of next week's festivals.
Dealers and traders had reported rather quiet trading conditions earlier in the week, but the falling Gold Price appears to have led to more people Buying Gold.
"Buying has started and come out in huge quantities," said Haresh Acharya, head of the bullion desk at Parker Bullion in Ahmedabad.
Next week sees several festivals in India, the largest of which will be the Hindu festival Diwali on Wednesday. Festival season is traditionally viewed as an auspicious time for Buying Gold.
As well as festival-related demand, India has also seen a trend towards Buying Gold for investment purposes. The second quarter of 2011 saw a 50% jump year-on-year in purchases of physical Gold Investment products such as coins and bars, according to data published by the World Gold Council.
Some analysts predict Q4 will see even higher demand.
"We think that demand from India will be resilient to higher Gold Prices for the remainder of the year on the back of seasonality and increased investment interest," says Edel Tully, precious metals strategist at UBS, which is India's biggest supplier of gold.
"My sense is that demand will be 30-40 percent higher than the fourth quarter of 2010," adds Gnanasekar Thiagarajan, director at commodities research firm Commtrendz in Mumbai.
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