Gold recovers; physical buying retreats

Gold recovers; physical buying retreats

Mumbai: Gold futures in India recovered from their previous session’s low on Tuesday afternoon, following a similar trend in global markets, and supported by a weaker rupee, dealers said.

The most-active gold for October delivery on the Multi Commodity Exchange (MCX) was 0.38% higher at 27,900 per 10 grams, after hitting a high of 28,013.

Global gold prices rebounded 1% from a sell-off in the previous session, as heightened worries about the sovereign debt crisis in Europe remain supportive of safe-haven demand for bullion.

The rupee plays an important role in determining the landed cost of the yellow metal, which is quoted in dollars.

Physical trading retreated after a few sessions of moderate pick-up as prices edged up. Traders awaited declines to stock for the upcoming festivals and weddings.

“The business is bit bad," said Daman Prakash Rathod, director with Chennai-based MNC Bullion.

India is the biggest consumer of bullion followed by China. Wedding and festival demand is expected to gain pace and peak in October and November before tapering off in December.