India Gold Imports "Could Hit 1000 Tonnes" Despite Record Gold Prices

TOTAL Indian gold imports could hit 1000 tonnes for 2011 – despite Rupee Gold Prices hitting record highs recently – a senior executive at a leading bullion bank has said.

A decline in jewelry purchases – blamed in part on the weak Rupee pushing Indian gold prices to record levels – has been offset by Gold Investment demand, says Rajan Venkatesh, managing director, India bullion at Scotia Mocatta.

"People are losing faith in cash, as loads of the US currency can be printed," Venkatesh told reporters at the Federation of Indian Chambers of Commerce and Industry's 'Gems and Jewellery Conference' in Mumbai.

"Investor demand has compensated the decline in the jewelry consumption. The rising Gold Prices, which has boosted the investors' appetite, may result in close to 1000 tonnes imports of the yellow metal."

Rupee Gold Prices hit a record high Rs29,295 per 10 grams earlier this month. Venkatesh meantime says Dollar Gold Prices could rise to $2000 per ounce by the end of March 2012.

Data from the World Gold Council's latest 'Gold Demand Trends' report show that Indian gold consumer demand in the third quarter of the year was 203.3 tonnes. Total Indian gold demand for the first three quarters of 2011 was 743.4 tonnes.

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