Mumbai: Gold extended losses for a second day on Wednesday due to continued profit-taking, but buyers stayed away hoping for bigger falls in the midst of the wedding season, traders said.
“These prices are not affordable to common customers,” said Shekar Jog, a partner with Sangli-based VS Bullion, which caters to western Maharastra and a part of north Karnataka.
“If the rates go below Rs12,500, there might be revival in demand,” Jog added.
“Still there is disparity of Rs400 between bank and local gold.”
The benchmark April contract on the Multi Commodity Exchange (MCX) fell by 0.41% at Rs15,205 per 10 grams at 1:18pm, after hitting a low of Rs15,175 earlier.
The contract had struck an all-time high of Rs16,040 on 20 February.
“Nobody is buying now...they are simply not ready to buy,” said Lokesh Kumar Agarwal, chairman, Brijwasi Bullions and Jewellers, which caters to markets in Uttar Pradesh and north Bihar.
“Wholesalers who had bought gold at lower rates are booking profits now,” Agarwal added.
India’s gold demand has slowed to a trickle mainly due to near-record prices and a weak rupee, resulting in negligible imports so far this year.
A weak rupee makes the dollar quoted gold expensive domestically.
The Bombay Bullion Association said India had not imported gold so far in February as high prices dampened demand for the metal and the outlook in the coming weeks remained downbeat.