India's gold sales to surge 40 per cent Y-o-Y

India's gold sales during 31October and 6 November, when the country celebrates Dhanteras and Diwali festivals, are expected to surge to 40 per cent on the 56 tonnes of last year, which would support the outlook for record imports in 2010, accord to a senior World Gold Council (WGC) official.

Dhanteras falls on 3 November when jewellers in India are known to record the annual highest gold sales with Diwali to be celebrated on 5 November, when Indian consumers buy the yellow metal for future prosperity.

According to a  report in The Times of India, Ajay Mitra, managing director of World Gold Council India and the Middle East told Reuters in an interview, that it was now an economical decision and the urge among consumers was to buy gold now than later as prices had continuously rallies upwards.

According to WGC projections the demand this year in north India, for the yellow metal would be better than the western region. The north consumed 16.8 tonnes of gold last year for Dhanteras while western India accounted for 19.6 tonnes of the precious metal last year of the total 56 tonnes.

According to the report, Mitra said the clinching argument as signaled by the Reserve Bank of India's (RBI)'s purchase of gold as, there was nervousness and uncertainty in terms of other assets' performance and how the currency markets would be shaping up.

The RBI bought 200 tonnes of gold from the IMF for $6.7 billion at an average price of about $1,045 an ounce at the end of 2009, in an off-market transaction. The transaction saw the central bank's gold holdings the record the 11th largest among its peers.