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Gold Imports by India Are Said to Drop for Third Straight Month

Elevated gold supplies and subdued demand in the domestic market are likely to weigh upon Indian gold imports.

Gold Imports by India Are Said to Drop for Third Straight Month
Gold bangles sit inside a display case at a Chow Tai Fook Jewellery Group Ltd. store in the Central district of Hong Kong, China. (Photographer: Billy H.C. Kwok/Bloomberg)

(Bloomberg) -- Gold imports by India, the world’s second-biggest market, are said to have slumped for a third consecutive month in November from a year earlier as supplies remain elevated in the local market and demand is slow.

Overseas purchases dropped to 91.5 metric tons, from 111 tons a year ago, according to a person familiar with the data, who asked not to be identified because the information isn’t public. Finance Ministry spokesman D.S. Malik declined to comment on the figures.

Demand in India is poised to revisit the seven-year low recorded in 2016 after tax and regulatory changes depressed sales, according to the World Gold Council. Consumption is more likely to be at the lower end of the range of 650 tons to 750 tons forecast in February, and close to the 666.1 tons of last year, P.R. Somasundaram, managing director for the WGC in India, said last month.

Supplies are ample in the local market, with inbound shipments in the first 11 months totaling 868.6 tons, 68 percent higher than a year ago, according to data compiled by Bloomberg. Imports boosted local inventories, after traders took advantage of regulations that allowed them to avoid taxes on purchases from certain countries before India tightened up the rules in October.

To contact the reporters on this story: Shruti Srivastava in New Delhi at ssrivastav74@bloomberg.net, Swansy Afonso in Mumbai at safonso2@bloomberg.net.

To contact the editors responsible for this story: Jason Rogers at jrogers73@bloomberg.net, Unni Krishnan at ukrishnan2@bloomberg.net, James Poole

©2017 Bloomberg L.P.