Gold extends weakness on global cues, low demand

New Delhi: Continuing its losing streak for a third straight session, gold prices plunged by Rs260 to Rs26,415 per ten grams in Delhi bullion market on Thursday, tracking a weak global trend amid low demand by jewellers and retailers.

Bullion merchants said a weak trend overseas where gold declined to more than four weeks as jobs data in the US pointed to a possible interest rate hike this month and on signs that India may slow imports.

Meanwhile, bullion traders have welcomed the government’s approval of Gold Monetisation scheme saying it will give a boost to the industry that will help them in getting more gold from the domestic market and reduce dependency on imports.

“Government’s gold scheme is a positive step that will help in containing large-scale imports, curb country’s current account deficit and help the economy,” All India Sarafa Association Vice-President Surinder Kumar Jain said.

The Cabinet on Wednesday had approved Gold Bond and Gold Monetisation schemes to reduce the metal’s demand in physical form and fish out idle gold lying with households and other entities.

Globally, gold fell 0.4% to $1,103.97 an ounce in Singapore. Besides, subdued demand from jewellers and retailers at domestic spot market dampened sentiment, they said.

In the national capital, gold of 99.9 and 99.5% purity dropped by Rs260 each to Rs26,415 and Rs26,265 per 10 grams, respectively. The precious metal had lost Rs165 in the previous two days. Sovereign also weakened by Rs200 to Rs22,000 apiece of eight grams.

In a similar fashion, silver ready declined by Rs80 to Rs35,250 per kg and weekly-based delivery by Rs340 to Rs35,460 per kg. However, silver coins continued to be traded at last level of Rs51,000 for buying and Rs52,000 for selling of 100 pieces.