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Gold demand subdued as prices hit 4-week high

business Updated: Aug 13, 2010 14:07 IST

Reuters
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India's wholesale gold demand remained subdued on Friday afternoon as prices hit a four-week global high, though a strong rupee support prices at home, dealers said.

"Sales are below normal now but some jewellery exporters are there buying in the market," said a dealer with a state-run bank, which deals in bullion.

Gold touched a four-week high, extending gains from the previous day as investors bought the precious metal and shied away from riskier assets on concern about the health of the global economy.

International gold was trading at $1,215.70/1,216.60 an ounce at 1:05 pm, as against the previous close of $1,211.20/1,215.20 an ounce, after hitting a four-week high of $1,217.35, the loftiest level since July 15.

"I have some five orders in $1,210-1,215 range, most of my orders are all below $1,200," said another dealer with a bullion dealing bank.

The Indian rupee strengthened after fresh dollar supplies hit the local market as regional stock markets rose, raising expectations of more capital inflows into Asia's third-biggest economy.

A strong rupee made the dollar-quoted yellow metal cheaper.

Following were the prices being quoted by Scotia Mocatta in rupees in the spot market at 10:15 am:
Friday Thursday
================================================
Gold .999/10 grams 18,700 18,600
Silver .999/kg 29,200 29,000

Following were prices in rupees on the Multi Commodity Exchange of India Ltd. at 1:07 pm:

Contract Current price Net change
======================================================
Oct gold 18,510 -40
Sept silver 28,978 +39