MUMBAI Gold importers in India, the world's biggest buyer of the metal, took to the sidelines as they awaited the key Reserve Bank's rate decision and its impact on the rupee. Silver steadied near the lowest in two weeks.
The Reserve Bank of India's rate decision is scheduled on Tuesday. Although the central bank is not expected to ease policy then, traders said they could cut the cash reserve ratio or sound more dovish on inflation.
The actively traded gold for February delivery on the Multi Commodity Exchange (MCX) was 0.09 percent higher at 31,235 rupees per 10 grams at 2.36 p.m.
"Market is very much in a range like the rupee, so physical market is dull. They are all waiting for the RBI meet tomorrow," said a dealer with a private bullion importing bank in Mumbai.
The rupee plays an important role for determining the landed cost of the dollar-quoted yellow metal.
In the overseas market, gold edged lower, extending losses to a third straight session, as trade slowed ahead of the year-end holidays and investors showed little response to the latest progress in U.S. budget talks.
Silver for March delivery on the MCX was steady at 61,500 rupees per kg, near their lowest level in two weeks.
(Reporting by Siddesh Mayenkar; Editing by G.Ram Mohan)