India's gold demand wanes; traders eye new lows

A woman wears a gold bangle at a jewellery shop in Siliguri in this October 1, 2008 file photo.

MUMBAI (Reuters) - India's gold demand eased on Monday after last week's pick-up as traders waited for lower levels, dealers said.

"There is no demand today... there was demand last week," said a dealer with a state-run bank in Mumbai.

"If prices fall below $850 (an ounce), then demand may revive," said the dealer.

Demand picked up last week as traders hunted for bargains after prices fell to a low of 14,022 rupees on April 6.

The benchmark June contract was 0.58 percent higher at 14,285 rupees per 10 grams at 2:22 p.m., still down about 4.8 percent from than the psychological 15,000 rupees level.

But dealers said volumes were down compared to the year-ago period. Traders normally buy to replenish stock for weddings and a key gold buying festival.

Weddings will start from mid-April and Akshaya Tritiya, which falls on April 27, is the second biggest gold-buying festival after Dhanteras.

"But if we compare this month with the year-before period, the volumes are still not picking up," added another dealer with a private bank.