Record gold prices could turn Indian buyers onto silver
Current indicators suggest demand for gold in India is of late being driven by investment sentiment, where price is a factor
Author: Lewa Pardomuan (Reuters)Posted: Thursday , 22 Oct 2009
HONG KONG (Reuters) -
Record high gold prices above $1,000 an ounce may encourage more Indian buyers to turn to much cheaper silver, a senior trade official from the world's top bullion consuming country said on Thursday.
"Even today the rural Indian invests more into silver than gold. Higher prices of gold imply even the lower middle class population shifting to silver more compared to gold," said Anjani Sinha, president of the Indian Bullion Market Association, which represents about 10,000 jewellers.
While silver has seen a much sharper price rise in the last 12 months, gaining 86% versus a 45% gain for gold, at $17.67 an ounce it is still nearly a fifth below its record high of March last year.
In contrast gold's latest rally has driven it well past the March 2008 high to a record just above $1,070 an ounce.
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