India gold demand sluggish as prices rise
MUMBAI Aug 14 (Reuters) - Demand for gold in India, one of the top buyers in the world, remained subdued on Tuesday after prices moved higher on a weak rupee and chasing a similar trend overseas.
* The most-active gold for October delivery on the Multi Commodity Exchange (MCX) was up 0.24 percent at 30,126 rupees per 10 grams by 0958 GMT.
* Indian rupee, which determines landed cost of imported gold, was trading lower on Tuesday.
* International spot gold rose on Tuesday, tracking a firm euro, as a slightly better-than-expected growth data from Germany and France helped ease concerns about the two biggest economies of the euro zone.
* "For the past few days demand was subdued. Jewellers are keeping lower inventory on concerns over demand from rural India due to poor monsoon and higher prices," said a Mumbai based dealer with a private bank dealing in bullion.
"Investment demand was weak as buyers were not expecting sharp rise from the current level," the dealer said.
* Rural areas, which depend on monsoon rains for agricultural yields and income, contribute to about 60 percent of the country's demand.
* Gold imports have already declined due to doubling of import duty, and the drought could further dent demand from rural areas.
* Festival season has started in India, the world's biggest consumer of the yellow metal last year, last week and will peak in November. Weddings will also take place during this period.
* Following were the prices in rupees at 1:15 p.m., quoted by HDFC Bank in the spot market :
Gold .999/10 grams 30,218 30,195
Silver .999/kg 55,155 55,130
Following were the prices in rupees on the Multi Commodity Exchange of India Ltd <0#MAU:>:
Contract Current price Net change
Oct gold 30,126 +72
Sept silver 53,544 +196 (Reporting by Rajendra Jadhav; Editing by Gopakumar Warrier)
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