India gold futures up taking cues from firm crude

MUMBAI, Aug 28 (Reuters) - India's gold futures were higher on Thursday on the Multi Commodity Exchange of India Ltd (MCX) tracking foreign markets where a firmer crude oil and a sliding dollar drew investors to precious metals.

"There is a sideways-to-positive bias as crude oil is higher, but the overall sentiment still remains weak," said Harish Galipelli, head of research at Karvy Comtrade Ltd.

Foreign gold, that guides the local market, was higher because crude oil gained on fears a tropical storm may hit the Gulf of Mexico, affecting oil installations there.

The slipping dollar, on comments by European Central Bank officials that scaled down expectations of an ECB rate cut, further boosted the yellow metal.

Gold generally moves in tandem with crude oil as the latter signals inflation, while the metal negates it. But it has an inverse relation with the dollar as the two compete for funds. The benchmark October gold was expected to trade within 11,740 rupees and 11,870 rupees per 10 grams, said Subodh Gupta, analyst at Anand Rathi Commodities.

Open interest for October gold was at 10,100 lots, up from 10,080 on Wednesday. Volume on the previous day was 52.914 kg. September silver MSVU8 was seen trading within 20,211 rupees and 20,480 rupees per kg, Gupta added. September silver traded at 20,355 rupees.

Following are gold prices in rupees per 10 grams on the Multi Commodity Exchange of India Ltd. at 10:55 a.m. <0#MAU:>:

Contract Current price Net change

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