(Adds details, dealers' comment)
By Rajendra Jadhav
MUMBAI, Feb 16 (Reuters) - India's January gold imports
plunged 76% from a year earlier to a 32-month low on subdued
demand after domestic prices rallied to record highs and as
jewellers postponed purchases, hoping for a reduction in import
duty, a government source said.
Lower imports by the world's second-biggest bullion consumer
could weigh on benchmark gold prices , but the fall may
help in bringing down India's trade deficit and support the
ailing rupee .
The country imported 11 tonnes of gold in January, compared
with 45 tonnes a year earlier, the source said on condition of
anonymity, as he is not authorised to speak to the media.
In value terms, January imports dropped to $697 million from
$2.38 billion a year earlier, he said on Thursday.
Local gold futures jumped to a record high of 57,270
rupees per 10 grams in January, stifling retail demand, which
had been expected to improve amid the ongoing wedding season,
said a Mumbai-based dealer with a private bullion importing
bank.
Weddings are one of the biggest drivers of gold purchases in
India as bullion in the form of jewellery is an essential part
of a bride's dowry and also a popular gift from family and
guests.
Jewellers and bullion dealers hardly bought any bullion in
the second half of January, as they had expected the government
would cut the import duty on gold in its annual budget to curb a
rise in smuggling, said a New-Delhi based bullion dealer with a
private bank.
India did not slash the import duty on gold in its budget
presented on Feb. 1 but raised the import duty on silver.
Local gold prices have fallen nearly 5% from the all-time
high and this has helped attract retail consumers, the
New-Delhi-based dealer said.
"In February, imports would improve. Bullion dealers and
jewellers need to build stocks for wedding season," he said.
(Reporting by Rajendra Jadhav; Editing by Jacqueline Wong and
Sonali Paul)
Messaging: rajendra.jadhav.thomsonreuters.com@reuters.net))
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