India Takes Control on Gold Market

Source:

"Analysts must redefine the world's bullion supply and demand dynamics."

In the global market gold witnessed no major movements as the traders are waiting for the U.S. job data which will be released later.

However, even as the world is awaiting the U.S. job and other economic data for making their further movements in the market as U.S. is the biggest influencing factor in almost all commodity markets, India and China are slowly seizing the deciding power in bullion market.

Since India is the largest consumer of the metal and China has emerged as the second largest economy in the world beating Japan, bullion market watchers are giving more importance to India and China to decide their future course of action.

An emerging bullion market in China, and a massive under-the-radar bullion stockpile in India, may require that analysts redefine the world's bullion supply and demand dynamics.

With a vast, domestic stockpile of bullion, Indians can trade in gold and silver in a way that can't be done in the West, because the premiums charged by Indian bullion dealers are only a tiny fraction of the hefty premiums which most Western retail buyers must pay.

Compared to the precious metals markets of other nations, India has a huge scrap-market. However, when stacked-up against the vast Indian stockpiles of gold (and silver), this scrap market suddenly looks much, much smaller.

Gold and silver prices had rallied to hit fresh all-time highs at the bullion market in Mumbai this week on hectic buying by stockists and speculators driven by strong trend in overseas markets.

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