Mumbai: India gold demand remained weak on Monday as traders were reluctant to take positions with prices above the keenly-watched Rs15,000 mark, dealers said.
The most-traded October contract was 0.19% higher at Rs15,025 per 10 grams, after hitting a high of Rs15,040, a level last seen on 6 August.
“The market has turned absolutely dull after Friday’s spike in prices,” said Pinakin Vyas, chief-manager, treasury, at IndusInd Bank in Mumbai.
The contract had gained 0.7% on Friday, when strong crude after the robust US home sales data, spurred buying in the yellow metal.
“Even a strong rupee is not helping,” said Vyas.
The Indian rupee climbed to a one-week high on hopes a global economic recovery would fuel demand for local stocks, but rising global commodity prices may check sharp gains.
A strong rupee makes the dollar-quoted asset cheaper.
Dealers said the underlying demand is still strong as traders would seek to replenish stocks for the festive demand.
“If the rupee holds well and gold comes down to around $940 (an ounce), we might see some activity in the market,” said another dealer with a state-run bank.
India is celebrating Ganesh Chathurthi, the first in a series of festivals, which is expected to revive gold’s physical off take.