Author: Paul Ploumis29 Jul 2014 Last updated at 08:19:29 GMT

NEW DELHI (Scrap Monster): The gold premiums in India crashed to new lows on account of weak domestic demand and higher supplies of the yellow metal. The premiums fell by almost 50% to $5-$6 per troy ounce on London price when compared with $10 per troy ounce during last week.

Trade sources indicate that gold demand in the country generally remains weak during monsoon season. The demand is likely to pick up only with the advent of festive season by mid-August.

Also, the low demand for gold has ensured that enough supplies are available. Consequently, the imports are expected to slow down in July and August, unless there is excessive gold demand during the festive season. According to Bachhraj Bamalwa, Director, All India Gems and Jewellery Trade Federation (GJF), the carry forward stock from June is still available. He also added that the imports are likely to reduce to 40-50 tonnes during July and August.

In rest of Asia, the gold premiums remained stable. Buying interest was witnessed as prices of gold fell below the psychological level of $1,300. However, volumes remained thin as buyers still expect more downside to gold in the immediate near-term.

Gold premiums in Hong Kong and Singapore remained flat at $1 per ounce to the global benchmark prices. Tokyo too returned to premium from discount witnessed earlier this month. On the other hand, premiums in China quoted at $3 during the week.