India gold discounts hit seven-week high as demand weakens; China buying improves

July 24 (Reuters): India's gold discounts widened to their highest level in seven weeks as demand remained subdued after a price rebound earlier in the week deterred buyers, while top consumer China saw an improvement in buying interest.
Domestic gold prices were trading around 141,800 rupees per 10 grams on Friday, after rising to 146,000 rupees earlier this week.
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"Footfalls at jewellery stores remain ?negligible. Retail buyers are waiting for a meaningful correction in prices before making purchases," said a Chennai-based jeweller.
Dealers quoted discount of up to $56 an ounce over official domestic prices this week, inclusive of 15% import and 3% sales levies, compared with a $45 discount last week.
"Market sentiment remains subdued, and jewellers do not expect demand to recover anytime soon," said a Mumbai-based bullion dealer with a private bank.
In China, bullion traded at a premium of $3 to $6 an ounce over the global benchmark spot ?price , having traded at par to a premium of $7 in the previous week. "The premiums this week are a bit firmer, as the market is seeing increased physical demand and buying interest, with $4,000 acting as a good support level," said Peter Fung, head of dealing at ?Wing Fung Precious Metals.
In Hong Kong, physical gold traded at a discount of $0.25 to a $1.70 premium, while in Japan , gold was sold at a discount of $0.25.
In Singapore , gold was sold ?a $1 discount to a $2 premium, versus par to a $2 premium last week.
International spot gold extended losses on Friday after sliding more than 2% in the previous ?session, as escalating tensions in the Middle East pushed oil prices higher, raising concerns about inflation and potential US Federal Reserve interest rate hikes.