Mumbai: Gold buyers paused for breath on Friday after a pick-up in sales the previous day, when India, the world’s largest consumer, celebrated Dhanteras, the biggest gold buying festival, dealers said.
“Yesterday demand was good, but today it is peaceful,” said a dealer with a large state-run bank in Mumbai. “Demand picked up yesterday both, quantity as well as deal wise.”
Dhanteras accounts for 15-20 tonnes of gold sales, trade estimates show.
The most-traded December gold contract was 0.25% higher at Rs15,769 per 10 grams at 2:57pm, helped by a weak rupee, making the dollar-quoted asset expensive.
The Indian rupee weakened in choppy trade as domestic shares failed to provide clear direction, while dollar demand from importers and mostly lower Asian units also weighed on sentiment.
India is in the midst of the festival season, with Diwali, the Hindu festival of lights, on Saturday, when consumers buy gold for auspicious reasons.
Dealers were hopeful sales to re-emerge for Diwali, and continue thereafter for weddings, if prices correct lower.
“There are many advanced orders below $1,040 (an ounce),” said another dealer with private bank in Mumbai.
Dealers said sales for dhanteras were 30% lower than last year, but better on month.
“The way 2009 has panned out, sales were better, but still they were down over 30% compared to last year,” said Haresh Acharya, head of bullion desk, Parker Agrochem in Ahmedabad.