Gold steady; demand weak on monsoon arrival

Gold steady; demand weak on monsoon arrival

London: Gold futures were steady on Tuesday while the overseas market was treading water, and demand in local physical markets remained weak, extending last week’s lull period, dealers said.

At 4:38pm, the most-active gold for June delivery on the Multi Commodity Exchange (MCX) was down 0.12% at 22,463 per 10 grams.

“It seems wedding season demand is over. From rural India, demand has fallen significantly as farmers are gearing up for the kharif season. They are spending money on seeds and fertilizers, not on jewelllery," said a Mumbai-based dealer with a private bank.

India’s annual monsoon rains have hit the southern state of Kerala two days earlier than expected, weather officials said on Sunday.

International gold steadied around its highest in nearly four weeks on Tuesday, supported by investor nervousness over the race in Europe to avert a Greek debt default, although stronger equities and oil tempered gains.

The rupee, which has a bearing on the landed cost of dollar-quoted gold, was at 45.05/06 per dollar, stronger than Monday’s close of 45.07/08 per dollar, tracking gains in local shares and the euro.