Reliance Capital follows FM advice,stops selling gold

Reliance Capital on Friday became the first company to suspend gold sales

Written by ENS Economic Bureau | New Delhi | Published: June 22, 2013 3:07:30 am

Reliance Capital on Friday became the first company to suspend gold sales across all its businesses following serious concerns over the impact of huge gold imports on the current

account deficit.

“Reliance Capital is committed to support all policy objectives of the government and the RBI. We sincerely hope that all stakeholders across business,trade and industry will act in a responsible manner to minimise gold imports,” said Sam Ghosh,chief executive officer,Reliance Capital.

The move comes after finance minister P Chidambaram had recently directed banks to discourage customers from buying gold. More companies are also expected to announce similar measures over the next few weeks,even as demand for gold is expected to dampen to just about 40 tonne in June from 162 tonne in May.

Along with the announcement to stop gold sales,Reliance Capital’s Commercial Finance Division has also decided to suspend financing against gold as a security.

Meanwhile,another company of the Anil Ambani led Reliance group — Reliance Capital Asset Management has decided to suspend new subscriptions in Reliance Gold Savings Fund.

The fund is estimated to have a total Asset Under Management of over Rs 2,200 crore. But existing Systematic Investment Plan investors will not be affected by the decision.

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