Gold buying slows as rupee weakens

Gold buying slows as rupee weakens

Mumbai: India gold demand slowed on Tuesday as the rupee weakened, which made the dollar-quoted asset expensive, dealers said.

Sales had picked up on Monday as overseas prices dipped, they added.

“I made good sales yesterday... we booked around 120 kgs at $1,227-1,231 (an ounce) but it has slowed due to rupee," said a dealer with a state-run bank in Mumbai, which deals in bullion.

The Indian rupee extended its drop to fresh one-week lows tracking losses in the domestic sharemarket and weighed by the euro’s fall overseas.

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

International gold, which guides the domestic market, was trading at $1,219.35/1,219.80 an ounce as against the previous close of $1,223.40/1,227.40.

“I have many advanced orders in between $1,217," said another dealer with a private bank.

India’s ongoing festival season will continue till November, when Dhanteras, the biggest gold buying festival is slated.