* India discounts fall to $2 an ounce; China premiums at $4-$5
* India’s Oct gold imports drop for fourth straight month
* Spot gold faces biggest weekly fall in 2-1/2 years
* India's gold market: tmsnrt.rs/2b1Tl6J
By Sumita Layek and Rajendra Jadhav
BENGALURU/MUMBAI, Nov 8 (Reuters) - Gold buying in India picked up this week as a correction in prices revived demand in world’s second biggest consumer, narrowing discounts to the lowest level in five months, while buying interest was tepid in other Asian centres.
“After Diwali, jewellers were not buying. As prices have corrected, they have resumed purchases,” said Harshad Ajmera, a gold wholesaler in Kolkata.
Indians celebrated the Dhanteras and Diwali festivals last month, when demand for the yellow metal peaks as buying gold is considered auspicious.
Gold futures were trading around 37,760 rupees per 10 grams on Friday after falling to 37,520 rupees on Thursday, the lowest level in a month.
Dealers offered discounts of up to $2 an ounce on official domestic prices this week, the lowest since the first week of June. They were offering a discount of $6 last week. The domestic price includes a 12.5% import tax and 3% sales tax.
Gold discounts have been narrowing as supplies are limited and jewellers are making healthy purchases, said a Mumbai-based dealer with a bullion importing bank.
India’s October gold imports fell a third from a year earlier, dropping for a fourth straight month as near record-high prices dampened festive purchases.
The country’s gold demand is expected to fall to its lowest level in three years in 2019, the World Gold Council (WGC) said on Tuesday.
In other Asian hubs, a drop in prices failed to prop up demand, with buyers awaiting further dips.
International spot gold prices were on track for their biggest weekly decline in 2-1/2 years, having fallen to a more-than-one-month low on Thursday.
“Gold is expensive compared to past years, demand took a hit because people are buying less than usual. Also, globally the economy is not doing as well, so that’s also affecting consumers’ purchasing power,” said Brian Lan, managing director at Singapore dealer GoldSilver.
In top consumer China, premiums of around $4-$5 an ounce were quoted compared with $5-$6 last week, as the long drawn-out trade dispute with the United States impeded purchases.
“The problem is more about consumption sentiment than gold prices, the Chinese economy is not in good shape and the unemployment rate has gone up,” said Samson Li, a Hong Kong-based precious metals analyst at Refinitiv GFMS.
In Hong Kong, gold was sold at a premium of 40-50 cents an ounce, versus 50-60 cents last week, as demand remained muted because of months-long street protests there.
Premiums in Singapore slipped to 50-80 cents an ounce range, compared with 65-90 cents the previous week.
In Japan, discounts edged up to 30 cents an ounce from 25 cents last week, a Tokyo-based trader said. (Reporting by Diptendu Lahiri in Bengaluru and Rajendra Jadhav in Mumbai with additional reporting by Swati Verma Editing by Mark Heinrich)