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After 5 months, the price of Asia Gold-India has increased due to festive demand and a price decrease

This week, gold prices in India rose for the first week in five months. The demand in India's second largest bullion market was boosted by a major festival. Prices also fell sharply after last week's record-high.

Indian dealers began the week with a discount They were charging up to $24 per ounce more than the official domestic price, including 6% import duty and 3% sales tax. But by the end the week they had dropped the premium to $3.

Last week they offered a discount up to $80.

The Akshaya Tiritiya festival boosted the retail demand, which was further boosted by lower prices. A Mumbai-based dealer from a bullion import bank said:

On Wednesday, Akshaya Tirtiya was celebrated, which is the second biggest gold buying festival in India, after Dhanteras.

The domestic gold price was trading at around 92800 rupees ($1,106.22), per 10 grams, on the day, after reaching a record of 99,358 last week.

Many potential retail buyers waited for a correction in prices due to the price volatility. "They would be likely to make purchases in the next few weeks if prices stay stable," said a bullion dealer based in Chennai.

As of 0539 GMT, spot gold was trading at around $3,256.44 after reaching a record-high of $3,500.05 in April.

Dealers in China, the top consumer, charged premiums between $34 and $48 per ounce above the global benchmark spot prices during the first half week. This compares to premiums between $44 and $50 last week.

The Chinese market is closed from May 1 to 5 for Labour Day.

In Hong Kong, gold Dealers in Singapore sold it at a premium of $2. Premiums are charged in the $2.50-$2.50 range.

Gold demand has increased with the price decline, particularly as Akshaya Tithi prompted Indians to purchase, said Brian Lan of GoldSilver Central in Singapore.

In Japan, bullion Was sold at a discounted price of $0.25 up to a premium of $0.50.

(source: Reuters)