Gold hits peak; deters physical buying

Gold hits peak; deters physical buying


Mumbai: Gold futures extended gains to hit a new peak on Thursday following a rally in overseas markets, and a weaker rupee, which made the yellow metal expensive, deterring physical buying ahead of a slew of festivals and weddings, dealers said.

The most-active gold for October delivery on the Multi Commodity Exchange hit a record high of 26,672 per 10 grams, before trading 0.98 percent higher at 26,652 at 3:54 pm.

Global gold rose for a fourth day, driven by unease over the lack of a solution to the European debt crisis and sluggish growth in the developed world that has shaken investor confidence in stocks, bonds and hard currencies.

The rupee remained weak in afternoon trades on Thursday as negative local shares and oil importers’ dollar demand weighed.

Record high prices kept physical activity muted, continuing a weak trend in sales so far in the month.

“It is not very good, seasonal impact is there. Prices are high for people to re-stock," said a dealer with a private bank in Mumbai.

Gold demand from India, the world’s biggest consumer, will gain pace with the advent of the festival and wedding season.

However, imports in the quarter to June rose 59% to 267 tonne, data from the World Gold Council showed.