MUMBAI (Reuters) - Gold fell to its lowest level in a week on follow-through selling on Thursday, a day after Cyprus was forced to sell most of its gold reserves, though the physical market was quiet as banks, the primary dealers of bullion, were shut for a holiday.
* At 5:39 p.m., the most-active gold for June delivery on the Multi Commodity Exchange (MCX) was down 110 rupees at 29,122 rupees per 10 grams, after hitting a low of 29,081 rupees, a level last seen on April 5, following weakness in the global markets.
* The contract had shed more than 1 percent on Wednesday, after news of the sale of gold reserves by debt-laden Cyprus.
* U.S. gold was 0.19 percent lower at $1,555.8 an ounce due to uncertainty over the Federal Reserve's stimulus programme.
* "Market is in a holiday mood, everyone is buying according to requirements. We see them come at 28,700 rupees," said Ketan Shroff, director with Mumbai-based Penta Gold.
* Banks were shut in India, the world's biggest buyer of the metal, for a local festival that marks the start of the auspicious period.
* The wedding season has begun in India and will continue till early June. Akshay Tritiya, the second biggest gold buying festival after Dhanteras, will also take place during this period.
* India has been trying to curb imports to put a lid on the record-high current account deficit. The federal government raised the import duty on gold, which it called a dead investment, by 50 percent to 6 percent in January.
* Finance Minister P. Chidambaram suggested last week the government was unlikely to raise the import tax on gold further to avoid gold smuggling.
* Silver for May delivery on the MCX was 0.67 percent lower at 51,426 rupees per kg.
(Reporting by Siddesh Mayenkar; Editing by Sunil Nair)
Trending On Reuters
Over a dozen debt-laden farmers have committed suicide in recent weeks in India, and discontent in many rural areas against government policies is turning into anger against Prime Minister Narendra Modi less than a year after he swept into office. Full Article