BENGALURU: Physical gold sales remained sluggish in Asia this week as higher prices kept buyers at bay, but appetite for the precious metal is expected to pick up with upcoming festive seasons in top markets India and China.
Bullion has risen nearly 1% this week on expectations that the US Federal Reserve will keep its cautious stance towards interest rates in the wake of global economic concerns.
Gold, often perceived as a hedge against financial uncertainties, has risen about 28% this year and is on track for its biggest annual gain since 2010.
"We are still seeing a good amount of selling as prices are near two-year highs and people are looking at making profits," said Brian Lan, managing director at Singapore-based gold dealer GoldSilver Central.
Bullion prices in top consumer China were seen at a premium of $1-$2 an ounce to the global spot benchmark, unchanged from last week. Premiums in Hong Kong also stayed at 20-60 cents an ounce.
"Usually the period from July-mid August is very quiet for jewelry. Towards the end of August, it will be little better on the physical side as people will order and take deliveries for Christmas," said Ronald Leung, chief dealer at Lee Cheong Gold Dealers in Hong Kong.
China's peak season for gold demand kicks off from the National Day holiday in early October.