Gold traders at bay; seek price declines

Gold traders at bay; seek price declines

Mumbai: Most Indian gold traders kept to the sidelines on Friday awaiting further falls and also as a weaker rupee weighed on sentiment, dealers said.

“Demand is nil... traders wants a further drop in prices, even the rupee is weak," said a dealer with a state-run bullion dealing bank in Mumbai.

“Price action would determine our sales volume, but overall enthusiasm is missing," said Daman Prakash Rathod, former convenor, Tamil Nadu Bullion Forum.

At 2:15pm, international spot gold was trading at $1,136.05/1,136.85 an ounce as against the previous close of $1,142.15/1,142.95.

“There were some overnight orders at around $1,131-1,132 (an ounce)," said another dealer with a private bank in Mumbai.

A weaker rupee makes the dollar-quoted asset expensive. The Indian rupee weakened slightly, weighed down by some strength in the dollar and a lack of momentum in the local sharemarket.

Dealers said there has been a slight pick-up in offtake in Tamil Nadu, where marriages will start early next week. Marriages elsewhere will be underway from April.

“There is some activity in our Chennai centre due to some marriages there, but these are all-last minute purchases," said another dealer with the state-run bank.

“Buying was good for most part of December.... We could see diverse buying activity from wholesalers to retail investors," Rathod said.

India’s gold imports provisionally rose to 32-35 tonnes in December as against 3 tonnes a year ago, the Bombay Bullion Association said on 1 January.