Mumbai: Gold demand in India rose on Friday, after prices fell 3% in the past two days, luring jewellers who began restocking and preparing for the wedding season beginning mid-January, dealers said.
“Jewellers are active. They were keeping lower stocks due to higher prices,” said Harshad Ajmera, proprietor of JJ Gold House, a wholesale in the eastern Indian city of Kolkata.
“For the past few weeks they were on sidelines expecting a price fall. Now, they think it is a good buying opportunity at current levels.”
At 3:42 pm, the most-active February gold on the Multi Commodity Exchange was 1.2% up at Rs27,157 per 10 grams, tracking a firm world market and on a weak rupee.
Demand was weak earlier this week due to year-end holidays and ongoing Khar Mass. Khar Mass is a month in the Hindu calendar, from 16 December to 14 January, which is considered inauspicious for gold buying and starting new ventures.
International spot gold rose 1% to $1,561.89 an ounce.
The rupee, which plays an important role in determining the landed cost of dollar-quoted gold, fell to 53.3 to the dollar from Thursday’s close of 53.07/08, as importers stepped up dollar-buying.
A Reuters poll earlier this month of 20 hedge fund managers, economists and traders showed international spot gold prices are expected to fall below $1,500 an ounce over the next three months and they are unlikely to retest September’s all-time highs until later 2012 at the earliest.