Gold extends losses, but physical demand weak

Gold extends losses, but physical demand weak

Mumbai: Gold futures in India extended losses from its Wednesday’s peak as investors chose to book profits, but physical buying remained weak as traders sought further price falls to stock for the ongoing wedding season, dealers said on Friday.

The most-active gold for December delivery on the Multi Commodity Exchange (MCX) was 0.11% lower at 28,669 per 10 grams. The contract had struck an all-time high of 29,123 on Wednesday, after gaining 12 percent since October.

Physical buying stayed weak in middle of the wedding season, which will last till December, in India, the world’s biggest buyer of bullion.

“Buying is not very encouraging and it’s muted," said a dealer with a private bullion importing bank in Mumbai.

A weaker rupee and flat overseas leads kept the downside in prices limited, dealers added.

Earlier in the day, the Indian rupee, which plays an important role in determining the landed cost of the yellow meta, fell to its lowest levels in more than two-and-a-half years as negative local shares weighed.

Overseas gold prices traded steady, following encouraging signs that Italy was making an effort to ease its political turmoil and avert an economic disaster, while investors remain nervous about the unfolding euro zone debt crisis.