Gold buying turns weak as prices near peak

Gold buying turns weak as prices near peak

Mumbai: India’s wholesale gold buying turned weak on Wednesday afternoon as prices traded near the all-time high, but dealers said the underlying demand remained strong due to the ongoing festival season.

“Who would buy at these highs? From yesterday gold has gone up by Rs200 (rupees per 10 grams)," said a dealer with a state-run bank, which deals in bullion.

Gold futures traded 0.07% higher at Rs19,182 per 10 grams, after hitting a high of Rs19,207, within reach of the record high of Rs19,211 struck in the previous session.

“There is pent-up demand in the market, but they want attractive levels like that of Rs18,500," said another dealer with a private bank in Mumbai.

Traditionally, demand for gold in India, the world’s largest consumer of bullion, is high during the September-November festival season. Dhanteras, considered an auspicious day for buying gold, falls in November.

A Reuters poll has estimated India’s gold import in 2010 at 504.5 tonnes, up by 24.5 tonnes from last year.