In retrospect, it's looking like gold's big summer rally was the flip side of the tumbling Indian rupee (as well as some other EM countries). Trouble is, the rupee has weakened so much vs. gold that it's choked off Indian demand - gold imports slumped 95% in August to just 2.5 tons vs. 47.5 tons in July, according to Mineweb.
That may just be a start as the Indian government is looking to impose another round of duties on imports of the yellow metal. "The country (is) no longer prepared to be a dumping ground for the world’s surplus gold at the cost of their more positive yielding assets," writes Izabella Kaminska in the FT.
With India shut down and ETF interest continuing to slip, will traditional importers like China and the MIddle East step up?
Gold continues to slide today, -2.8% to $1,326 per ounce.