Silver sales look brighter with price dip, festivals

Tag : silver bullion

By Ruchira Singh
MUMBAI (Reuters) - India's silver sales may pick up this month onexpectations prices will fall on the back of crude oil and demandwill revive ahead of the busy season, traders and analysts said.
"Demand has not picked up yet as people are looking at more fallsbecause crude oil has come down," said Haresh Kewalramani, directorof the Bombay Bullion Association who also trades silver items.But, "there will be some kind of demand owing to festivals."
India's silver futures fell as crude oil eased from its all-timehighs above $147 a barrel earlier this month amid demand concernsand higher output. Precious metals generally track crude oil as thelatter signals inflation while the metals negate it.
On the continuation charts of the Multi Commodity Exchange of IndiaLtd (MCX) , silver traded at 23,400 rupees per kg, down 15 percentfrom an all-time high on March 17.
With India's festival season starting in September when retailsales are at a peak, wholesalers are already looking out foropportune dips to stock up.
"There has been a bit of buying this week, it can be more if silverfalls further," said Sanjeev Solanki, senior trader at M.D.Overseas Ltd, a large precious metals importer in New Delhi.
But an analyst said lower demand for sliver globally may weigh onprices.
"We are not looking at much jewellery or industrial demand becauseof high prices and economic slowdown," said Debjyoti Chatterjee,associate vice president at MAPE ADMISI Commodity Research.
Silver prices are likely to fall to 22,500 rupees to 23,000 rupeesper kg levels owing to lower physical demand globally this year, headded.