India gold firm, buyers eye 12,000 rupees/10 grams

MUMBAI (Reuters) - India's gold's prices were little changed on Monday amid higher crude oil, but buyers stayed on the sidelines as last week's correction had raised hopes of more falls ahead, dealers said.

"Now buyers will be interested only if prices fall closer to 12,000 rupees per 10 grams," said Prithviraj Kothari, director of Riddisiddhi Bullions Ltd, a large Mumbai-based wholesaler.

Foreign gold, that guides the local market, stayed near the previous session's levels supported by oil that jumped on supply worries after a tropical storm threatened the Gulf of Mexico and Iran's nuclear programme worried the Western world.

Gold generally tracks crude oil as the latter signals inflation while the metal negates it.

In the local market, prices hovered around 12,500 rupees per 10 grams -- a level buyers had been eyeing -- but the month-low dip last week to lower levels had been bought well and met near- term demands.

"After last week's good business, the market is silent," said D.P. Naresh of Micro International, a large wholesaler in Bangalore.

A dealer in a bank said his clients were waiting for $900 an ounce to buy for the next season to start in September.

Following was the price of .995 gold in the spot market in rupees per 10 grams at 1:15 p.m. :