Mumbai: India’s gold demand abated on Friday as prices neared the most-watched Rs15,000-mark, along with a weak rupee weighing on sentiment, dealers said.
“We are not hearing much from our customers as prices have touched Rs15,000,” said a dealer with a state-run bank in Mumbai. “A weak rupee is also keeping buyers away.”
The most-traded October contract was 0.31% higher at Rs14,985 per 10 grams at 2:03pm, after hitting a high of Rs15,004, the loftiest level since 6 August.
The Indian rupee eased as a choppy start to domestic share market failed to provide clarity on direction of foreign fund flows. A weak rupee makes the dollar-quoted yellow metal expensive.
However, dealers said demand had picked-up since the start of the month after a period of lull as traders sought to replenish stocks to meet festive demand.
“Demand is definitely better than last two months,” said another dealer with a private bank in Mumbai.
A section of India’s top gold merchants are preparing for a sharp pick-up in gold sales this festive season, suggesting demand by the world’s top consumer is rebounding despite near-record prices and a bleak monsoon.