India, the world’s biggest consumer of gold, could implement more measures to curb imports, a top economic official said as the country seeks to narrow a record current-account deficit and check the currency’s drop.
Gold traders turned bearish for the first time in a month as investors reduced holdings in exchange- traded products for an unprecedented 17th consecutive week and India, the biggest buyer, announced curbs on imports.
India’s rupee headed for a sixth weekly drop, the longest losing streak in a year, on speculation U.S. policy makers will scale back asset purchases that have boosted inflows into emerging markets. Bonds fell on concern a weaker currency will spur inflation.
Gold imports by India, the world’s largest consumer, are plunging as an increase in tax and restrictions on financing shipments boost costs for jewelers, helping the nation contain a record current-account deficit.
India’s rupee rose, extending its rebound from a record low, after the government said it is considering options to spur inflows and Fitch Ratings revised the nation’s credit-rating outlook to stable from negative.
The Federal Reserve, under political pressure to combat unemployment, risks creating financial instability through its record monetary stimulus, according to University of Chicago Professor Raghuram Rajan .