Bank deposits take shine off gold; import may dip 55% in Feb

Posted By: Pti
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Mumbai, Feb 27 (PTI) Higher returns from bank depositsseems to have taken away the glitter from the yellow metalwith a massive decline, to the tune of 55 per cent, expectedin gold imports in February.

India''s gold import is likely to dip by 55 per cent to20-25 tonne in February as compared to 45 tonne in the samemonth in 2010 following increase in bank deposit rates tonearly 10 per cent, Bombay Bullion Association PresidentPrithivraj Khotari told PTI here.

"Higher food inflation and liquidity problem in themarket have further affected the demand," he said.

Khotari said record gold prices during February, whichalmost touched Rs 21,000 per 10 grams, is also likely to havenegative impact on imports. India is the world''s largestconsumer of gold.

Gold price on Multi-Commodity Exchange on Saturdayruled at Rs 20,961 per 10 grams, while the international pricewas at USD 1,410.20 an ounce (28.34 grams).

However, the World Gold Council had recently given apositive outlook for the precious metal in 2011 despite theruling high price.

"Last year was great year for gold globally, speciallyfor India and China. India emerged as the strongest marketwith total demand rising by 66 per cent at 963 tonne amidstrong economic growth. The outlook for this year is alsorobust," WGC Managing Director (Middle-East and India) AjayMitra had recently said.

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