Silver imports in India are hitting new highs as 338 tonnes of the precious metal was brought into the country during the month of October. Data from Thomson Reuters GFMS shows that this represents a 40% increase from the month prior. The reason is pretty clear as gold investors and jewelry buyers have not been able to purchase gold, during the Diwali and wedding seasons, which is just hitting its third month. This is due to the Indian government's restrictions on gold and the resulting scarcity (and higher prices) of the precious metal.

As per Thomson Reuters GFMS;

"By the end of the year, silver imports should be at 5,200-5,400 tonnes," said Sudheesh Nambiath, an analyst with Thomson Reuters GFMS. This would be more than India's record high purchases of 5,048 tonnes in 2008.The country has imported 4,652 tonnes of silver in the first ten months from January, GFMS data shows."

If you can't get gold, might as well grab some of its little brother/sister. The lower cost of silver also allows the people to accumulate more of it than gold and even though the silver to gold ratio may be historically out of whack, the people of India know that it still provides them with some safety versus the rupee (local currency).

Comments (0)