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Gold rush abates as high rates bite

business Updated: Mar 05, 2010 21:45 IST

Reuters
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Indian gold demand abated on Friday afternoon as traders awaited price dips after a late evening pick-up in offtake in the previous session, dealers said.

“We had some export covering yesterday and some domestic deals as well at $1,129-1,133 (Rs 51,595-51,778) per ounce, but today, I am not hearing anything from them,” said a dealer with a state-run bank in Mumbai.

International gold, which guides the domestic market, was $1,132.85/1,133.85 (Rs 51,771/ 51,817) an ounce as against the previous close of $1,131.5/1,132.3 (Rs 51,707/ 51,744) an ounce.

“People are still away from new indents and could come in at around $1,115 (Rs 50,956), and if the rupee stays at the same level,” said the state-run bank’s dealer.

“They are looking at $1,110 (Rs 50,727)to buy for weddings,” said a private bullion dealing bank dealer.

Gold tracked the euro higher before the release of US payrolls data — which could raise concerns about the pace of the economic recovery — hurt the dollar but left bullion’s allure as an alternative investment.

India’s gold imports between February 1 and February 25 were provisionally at 30-35 tonnes, about four times the level of a year ago as lower prices encouraged demand, the head of Bombay Bullion Association (BBA) said.