A sharp rally in MCX gold at the end of last week prompted a wave of scrap selling in India and elsewhere in Asia as market participants took advantage of higher prices, while fresh buying was sluggish on Wednesday. More information about free mcx tips visit my site mcx-trade-tips.blogspot.com
Spot MCX gold jumped more than 5% last Friday on rising expectations the US Federal Reserve could be forced to launch more monetary stimulus after data showed a surprisingly weak jobs stock market.
Gloomy equity markets and high interest rates have forced investors in India to cash out of MCX gold, said Prithviraj Kothari, president of the Bombay Bullion Association.
"There is no money available and people are selling their old MCX gold," Kothari said, adding that India could see scrap sales rise to 400 tonnes this year, more than triple last year's 130 tonnes.
The rupee tumbled to a record low against the dollar last week, but has since pared some of those losses. The weak rupee has kept local MCX gold prices at lofty levels and dampened buying demand in India, traditionally the world's top gold consumer.
MCX Gold bar premiums in Hong Kong were steady around USD 1.10 to USD 1.60 an ounce above London prices. In Singapore, premiums were unchanged from a week earlier at USD 2, dealers said.
"Last night, there was some selling from Thailand and other countries in Southeast Asia, and demand from Chinese banks was mediocre," said a Singapore-based dealer.
Some said people could be taking advantage of the difference between onshore and offshore interest rates by shipping gold back and forth for financing purposes.
In Tokyo, fresh selling eased the tight supplies that had pushed local MCX gold bar premiums to a 14-month high in late May, dealers said.
"Supply is still tight but has improved as higher prices have lured back some selling," said a Tokyo-based dealer, though he added that the strong yen was capping selling interest.
After this week's ECB rate decision and Bernanke testimony, investors will closely watch the Greek elections on June 17 and a Group of 20 meeting on June 18-19 for clues on the state of the euro zone crisis and potential solutions.
Spot MCX gold jumped more than 5% last Friday on rising expectations the US Federal Reserve could be forced to launch more monetary stimulus after data showed a surprisingly weak jobs stock market.
Gloomy equity markets and high interest rates have forced investors in India to cash out of MCX gold, said Prithviraj Kothari, president of the Bombay Bullion Association.
"There is no money available and people are selling their old MCX gold," Kothari said, adding that India could see scrap sales rise to 400 tonnes this year, more than triple last year's 130 tonnes.
The rupee tumbled to a record low against the dollar last week, but has since pared some of those losses. The weak rupee has kept local MCX gold prices at lofty levels and dampened buying demand in India, traditionally the world's top gold consumer.
MCX Gold bar premiums in Hong Kong were steady around USD 1.10 to USD 1.60 an ounce above London prices. In Singapore, premiums were unchanged from a week earlier at USD 2, dealers said.
"Last night, there was some selling from Thailand and other countries in Southeast Asia, and demand from Chinese banks was mediocre," said a Singapore-based dealer.
Some said people could be taking advantage of the difference between onshore and offshore interest rates by shipping gold back and forth for financing purposes.
In Tokyo, fresh selling eased the tight supplies that had pushed local MCX gold bar premiums to a 14-month high in late May, dealers said.
"Supply is still tight but has improved as higher prices have lured back some selling," said a Tokyo-based dealer, though he added that the strong yen was capping selling interest.
After this week's ECB rate decision and Bernanke testimony, investors will closely watch the Greek elections on June 17 and a Group of 20 meeting on June 18-19 for clues on the state of the euro zone crisis and potential solutions.
