Indian gold market flips into discount
Demand for gold bars, coins still robust in China analyst
Recent spike in premiums due to lack of new import quotas Citi

Sept 1 Reuters Premiums on physical gold in China eased off recent highs this week as safehaven buying cooled on hopes that stimulus could help the top bullion buyer39;s ailing economy.

Chinese dealers sold gold at 2038 an ounce premiums over global spot prices , after jumping to 4060 last week.

Despite prevailing pessimism, China39;s economy seems to be performing better than perceived, said Bernard Sin, regional director, Greater China, at MKS PAMP. This has led to expectations that gold import quotas could be introduced sooner rather than later.

Beijing has ramped up stimulus efforts of late.

But independent analyst Ross Norman said retail buyers were now largely absent, given lingering economic concerns, although safehaven demand for gold bars and coins was robust.

High domestic prices also dented demand to some extent.

Analysts at Citi Research forecast Chinese demand to temporarily ease in the third quarter, also attributing the recent spike in premiums to reduced gold import licenses issued to local banks by the People39;s Bank of China.

Gold is also one way locals can hedge against CNY depreciation. However, it seems policymakers there are intent on at least temporarily curbing gold demand, Citi said in a recent note.

In India, a near 2 rise in local prices in a fortnight, put off buyers and…