Asia Gold-China premiums rise as demand picks up after holiday pause
Chinese premiums rise to $45-$55 per ounce
India premiums ease to $3/oz vs $3.5 last week
Premiums of $1.80-$3/oz charged in Singapore
By Brijesh Patel and Rajendra Jadhav
Feb 23 (Reuters) -Physical gold demand picked up in China this week as the top bullion hub reopened after the Lunar New Year holidays, while a correction in domestic prices in India failed to impress buyers.
Chinese dealers charged premiums of $45-$55 per ounce XAU-CN-PREM over benchmark prices XAU=, up from $36-$48 per ounce quoted two weeks ago.
"Chinese gold demand remains closely tied to the relationship between the gold premium and the RMB," said Bernard Sin, regional director of Greater China at MKS PAMP, adding higher premiums reflect a positive shift in sentiment towards Chinese assets following holidays.
On Wednesday, China's yuan rebounded to a near three-week high against the dollar, underpinned by Beijing's efforts to boost its economy and property sector.
"While fresh gold imports have contributed to this improvement, we anticipate the People's Bank of China to maintain control over the RMB," MKS PAMP's Sin said.
In India, dealers were charging a premium XAU-IN-PREM of up to $3 an ounce over official domestic prices — inclusive of 15% import and 3% sales levies — down from last week's premiums of up to $3.5.
"Retail demand is still way lower than usual because of volatile prices. Consumers are just waiting to see if prices might drop even more," said a New-Delhi based bullion dealer.
Local gold prices MAUc1 were trading around 62,000 rupees per 10 grams this week after hitting a record high of 65,040 rupees earlier this month.
Jewellery demand is weak despite the ongoing wedding season, although purchases of coins and bars are gaining some traction, said a Mumbai-based bullion dealer with a private bank.
In Hong Kong, bullion was sold at premiums of $2-$3.50 XAU-HK-PREM, while premiums between $1.80 and $3 were charged in Singapore. XAU-SG-PREM
In Japan, dealers sold gold XAU-TK-PREM anywhere between a discount of $1 to $0.5 premiums, with higher rates denting demand.
Reporting by Brijesh Patel, Sherin Elizabeth Varghese in Bengaluru, and Rajendra Jadhav in Mumbai; Editing by Arpan Varghese and Arun Koyyur
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