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Gold demand sluggish as rupee weakens

Gold demand sluggish as rupee weakens
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First Published: Mon, Aug 31 2009. 02 44 PM IST
Updated: Mon, Aug 31 2009. 02 44 PM IST
Mumbai: India gold demand remained sluggish on Monday as the rupee weakened, making the dollar-quoted asset expensive, ahead of an inauspicious period to buy the yellow metal, dealers said.
“I have not entered into a single deal since morning on a weak rupee. No one is buying inspite of discounts on the bank rate,” said Daman Prakash Rathod, director with MNC Bullion in Chennai.
Dealers said a dip below $945 an ounce could revive some buying interest.
“I have a lot of orders at $943 (an ounce),” said a dealer from a state-run bank.
The Indian rupee continued to be weak in afternoon trade with lower local shares fuelling concerns about capital outflows, with losses in most other Asian peers adding to the gloom.
Dealers expect the physical offtake to remain muted ahead of an inauspicious period to buy gold.
Shradh, a period for paying homage to ancestors, is from 5 to 19 September.
“Buying would be limited as Shradh is near-by and even marriages are limited,” said Rathod.
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First Published: Mon, Aug 31 2009. 02 44 PM IST
More Topics: Markets | India | Gold futures | MCX | Rupee |