Mumbai: Gold traders in India, the world’s biggest bullion buyer, booked deals as they sought to stock ahead of a slew of festivals and weddings after prices fell more than 2% following weak overseas market and a stronger rupee back home.
“People have jumped to buy gold due to current decline...,” said a dealer with a private importing bank in Mumbai, which sold 300-400 kgs on Wednesday.
Global spot gold dropped 2 percent abruptly to as low as $1,826, nearly $100 off the all-time high above $1,920 hit in the previous session, tracking heavy losses on US gold futures on technical selling.
The rupee strengthened, snapping a two-day losing streak, aided by gains across Asian equities and currencies, while a volatile euro limited the rise.
The rupee plays an important role in determining the landed cost of the yellow metal, which is quoted in dollars.
India’s wedding and festival demand will gain pace and peak in October before tapering off in December.