Mumbai: Gold recovered from its lowest level in a month tracking overseas markets, though a strong rupee kept the upside in prices limited, but physical buying retreated after a slight pick-up in the previous session.
“They won’t want to book deals now. Yesterday we booked for 150 kgs in between $1,387/1,416 (an ounce),” said a dealer with a state-run bank in Mumbai.
The most-active gold for April delivery on the Multi Commodity Exchange was trading 0.33 percent higher at 20,672 rupees per 10 grams, after hitting a high of Rs 20,690.
The contract recovered from a one-month low of 20,469 struck in the previous sesion, a level last seen on 16 Feb..
Overseas gold regained strength after falling to a one-month low in the previous session, but declines in ETF holdings to their lowest in 10 months suggested that speculators could still sell bullion to raise liquidity if equities reversed gains.
The Indian rupee pared early gains due to dollar demand from oil and gold importers but Asian currency and domestic share strength supported the local unit.
The high-demand wedding season is underway in India, the world’s largest consumer of the yellow metal. India’s gold imports in Oct-Dec rose 30% to 265 tonnes.