DNA reports that banks in India are beginning to roll out gold bars and coins in various denominations from 5 gm to 100 gm, in the hopes of cashing in on the anticipated 25 per cent rise in demand during the festival season. The move comes at a time when gold prices have declined to their lowest level in almost two months – reaching $574 an ounce at one point – from a record high of $730 an oz in May.%%Apart from targeting corporate purchases, banks such as ICICI, HDFC, Corporation Bank and the State Bank of India are offering coins embossed with religious symbols and images of deities, as the country readies for the festival season which encompasses close to 14 festivals including Diwali, Ramzan Eid, Dassera and Christmas.
%%The Kotak Mahindra bank launched 24 karat Swiss-manufactured gold bars in lots of 50 gm and 100 gm across 42 of its bank branches. “Gold performs the function of a wealth preserver in a portfolio. It helps hedge risks against growth asset classes like equity,” K.V.S. Manian, the head-retail liabilities and branch banking at Kotak Mahindra bank told The Hindu Business Line.
%%Sales of gold coins and bars have gone up by 200 per cent to 1-1.5 tonnes per week in the past fortnight. “Since gold prices have dipped, gold coin and bar demand has moved up to such an extent that it has created a scarcity in the market. Today, gold is not available for ready supply with us, and also with other suppliers like UBS and Swiss Credit,” stated Vijay Kapoor of Metloy Trading.