Mumbai: Gold extended gains for an eighth session running to hit a record high on Tuesday, aided by a weaker rupee and firm overseas markets.
The high prices kept away physical traders who are watching the progress of the monsoon to gauge festival demand in the coming months.
At 3:12pm, the most-active gold for August delivery on the Multi Commodity Exchange (MCX) was 0.30% higher at Rs 30,402 per 10 grams, after hitting a peak of Rs 30,428 earlier in the day. The contract has gained 2.5% in the previous seven sessions.
Overseas gold rose for the eighth day in a row, its longest winning streak in almost a year, on hopes the US Federal Reserve may launch more measures to stimulate the world’s largest economy.
The rupee, which fell to a low of 56 rupees per dollar, plays an important role in determining the landed cost of the dollar-quoted yellow metal.
The onset of the rains curtails festive and wedding activity. Indian farmers, who depend on monsoon rains for a good harvest, contribute to more than half the country’s gold demand.
“Demand is still zero,” said Haresh Acharya, head of bullion desk at Parker Bullion in the western Indian city of Ahmedabad.
Silver also moved higher following the yellow metal.