OUTLOOK-India silver futures may extend gains in March

MUMBAI, March 8 (Reuters) - India silver futures are expected extend February's gains this month on the back of rising prices in the base metals complex and expectations of a weaker dollar overseas, analysts said. "Base metals are doing good and dollar is consolidating lower, so silver may trade higher," said Harish Galipelli, vice president research with JRG Wealth Management.

The most-active silver May contract MSVc1 was 0.08 percent higher at 27,057 rupees per kg at 5:53 p.m. It has gained 1.07 percent in February.

The white metal is usually influenced by gold as investors tend to treat all precious metals as one class. But the metal also takes a cue from base metals, particularly copper, as it is partly an industrial metal used in photography and electronics.

Copper has been on a upward move on the back of encouraging signs of a global economic recovery.

The dollar index .DXY, a gauge of dollar's performance against a basket of currencies, was 0.08 percent lower 80.365 at 80.366.

Buying is recommended in silver at 26,600, for a target of 27,600, maintaining a stop loss of below 26,100, said Galipelli.

REVIVING PHYSICAL OFFTAKE:

Analysts and traders said the local offtake was reviving ahead of the wedding season, which starts in April, could support prices.

National Spot Exchange Limited (NSEL) delivered 10.35 tonnes of silver in February, up from 0.390 tonnes on year, indicating a pick-up in offtake as weddings near in the world's largest consumer of precious metals, it said. See [ID:nSGE62201V]

"Further pick-up in demand could take place after March 20, when wedding purchases would start," said Pankaj Kumar Agarwal, director with Lucknow-based wholesale, Brijwasi Bullions and Jewellers Pvt. Ltd., which caters to markets in Uttar Pradesh and north Bihar. (Reporting by Siddesh Mayenkar; Editing by Ramya Venugopal)