Record prices dampen demand in top hubs
Physical gold demand among top consumers China and India remained negligible this week as buyers shied away from purchases due to record high prices.
"Buyers are just sitting back, watching the price moves. They're waiting on the sidelines, hoping to jump in once prices drop," a Kolkata-based jeweller said.
Domestic gold prices MAUc1 hit a record high of 86 592 rupees ($998.61) per 10 grams this week and have risen more than 12% so far in 2025 after a 21% gain last year.
Indian dealers this week offered a discount XAU-IN-PREM of up to $35 an ounce over official domestic prices, – inclusive of 6% import and 3% sales levies, up from last week's $26 discount.
The wedding season is underway but jewellers aren't making any purchases due to lacklustre retail demand, a Mumbai-based dealer with a bullion importing bank said.
Weddings are a major driver of gold purchases in India, with gold jewellery forming a crucial part of a bride's attire and a popular gift from family and guests.
In China, gold was sold at a discount between $1-$3 per ounce over spot prices XAU=.
"The record prices have prompted significantly weaker offtake from jewellery buyers (in China) with the sector in the doldrums," independent analyst Ross Norman said.
Meanwhile, gold exports from Switzerland to India and China plunged 88% and 99%, respectively on an annual basis, customs data showed.
In Singapore, dealers quoted a premium XAU-SG-PREM of $3-$4 per ounce. Dealers in Hong Kong charged on par to $2.20 per ounce premiums XAU-HK-PREM.
In Japan, bullion was sold XAU-TK-PREM between a discount of $5 and a premium of $1.5.
"We have seen buying interest but profit-taking volume is getting bigger," a Japan-based trader said.
Another trader said since the Japanese yen was very strong this week, many people wanted to buy bullion.
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