Gold buying extends for second day

Gold buying extends for second day

Mumbai: India gold buying continued for a second day on Monday ahead of an upcoming festival and wedding season as prices stayed in the vicinity of their two-week lows prompting traders to stock more, dealers said.

“I did normal deals today at around $1,105-1,107 (an ounce), even Friday was good, when we sold about 100 kgs at 1,100-1,105 levels," said a dealer from a state-run bullion dealing bank.

International gold, which guides the domestic markets, was trading at $1,105.45/1,106.25 an ounce as against the previous close of 1,099.50/1,103.50 an ounce.

Gold has struck a two-week low of $1,098.25 an ounce in the previous session, a level last seen on 25 February.

Gold prices rose as concern over sovereign debt fuelled buying of the precious metal as a haven from risk, with technical factors also supporting the market.

“A lot of orders are there at about $1,090 (an ounce)," said another dealer with a state-run bank.

However a weak rupee, which makes the dollar-quoted asset expensive, weighed on sentiment.

The Indian rupee weakened, weighed down by gains in the dollar against major currencies and losses in the local sharemarket.

India celebrates Gudi Padwa, the Maharashtrian new year, on Tuesday and the weddings season starts from April.