Image Source : Free Press Journal
India's June import figures indicate a breathtaking mismatch of investor appetite. Silver imports rose to 197 metric tons from 109 tons during the same period last year, while gold imports fell to a two-month low of 21 metric tons.
Key Highlights:
- Demand for silver continues to rise, driven by industrial demand and positive investor sentiment
- Gold imports declined 40 percent year on year, affected by all-time local prices hitting Rs 101,000 a 10 grams
- Relative value and price catch-up expectation of silver versus gold are fueling accumulation
Market Dynamics:
- The gold-silver ratio has widened, with silver increasingly becoming the preferred hedge for institutional and retail investors
- Rural demand and consumption requirements drive the speed of silver during price fluctuation
- Gold’s subdued demand reflects cautious buying amid high valuations and tepid jewelry sales
Prospects:
- Analysts expect silver imports to continue being strong, with gold possibly remaining muted unless prices adjust
- Short-term trends may be influenced by seasonal factors and forthcoming holidays
Sources: Reuters, Yahoo Finance, Economic Times, SilverSeek, FastBull.
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