|Chennai||Rs. 27770.00 (-0.14%)|
|Mumbai||Rs. 29200.00 (2.31%)|
|Delhi||Rs. 27900.00 (-0.36%)|
|Kolkata||Rs. 28270.00 (1%)|
|Kerala||Rs. 27050.00 (-0.37%)|
|Bangalore||Rs. 27550.00 (1.66%)|
|Hyderabad||Rs. 27770.00 (-0.14%)|
Gold prices held near $1,715 an ounce on Thursday as investors' focus shifted from President Barack Obama's re-election to U.S. fiscal woes and the euro zone debt crisis, which pressured the euro to a two-month low against the dollar.
Worries about the fiscal cliff are supportive of safe-haven gold, but a strong dollar offset upward pressure on prices by making it more expensive for buyers holding other currencies.
Spot gold was at $1,714.3 an ounce by 1143 GMT, down 0.12 percent, while U.S. gold inched up 0.03 percent to $1,714.50.
Gold prices hit a 2-1/2 week high at $1,731.40 an ounce on Wednesday after Obama's re-election gave markets a boost by ending weeks of political uncertainty, but they have struggled to maintain those gains.
In the longer term, gold is likely to benefit from uncertainty over the looming "fiscal cliff" when nearly $600 billion worth of spending cuts and tax increases kick in with the risk of pushing the U.S. economy into deep recession.
"(Tackling the fiscal cliff) is not going to be an easy task but.... having seen how close the election was between the two (Obama and Mitt Romney), it seems Obama is ready to start a dialogue," Afshin Nabavi, head of trading at MKS Finance, said.
He said he saw key resistance for gold at $1,730, close to Wednesday's high, and then $1,750 and $1,800.
Investors are now awaiting results of a European Central Bank policy meeting. The bank is expected to leave interest rates unchanged, waiting to show its mettle with a new bond-purchase programme.
The euro zone debt crisis was back in focus, with the euro under pressure from fresh speculation that Spain is not in a hurry to request financial aid.
Greece's government voted by a razor thin margin on Thursday to approve an austerity package needed to unlock vital aid and avert bankruptcy, despite an internal rift and violent protests at the gates of parliament.
"The Greeks managed to narrowly pass their initial austerity vote overnight, but the main budget vote is this weekend and that needs to be passed for the EU bailout to happen," Marex Spectron said in a note.
"So the euro woes remain for the time being, which will once again create uncertainty in the FX markets, with the effects affecting precious metals."
INDIAN DEMAND HURT BY HIGH PRICES
Gold importers in India, the world's biggest buyer, held off buying on Thursday as a weaker rupee kept prices in the vicinity of their highest level in a month.
The festival season in India will peak with Diwali next week, with weddings also slated to continue till December.
China's gold demand is expected to grow 1 percent this year to a record of around 860 tonnes, the global head of metals at consultancy Thomson Reuters GFMS said on Thursday, with both jewellery and investment sales rising.
That increase means China will overtake India as the world's biggest consumer of gold for the first time on a yearly basis, Philip Klapwijk told the online Reuters Global Gold Forum.
"China will overtake India.... both in overall demand terms and as the world's largest jewellery market," he said.
South Africa's gold output fell 11.1 percent in volume terms in September while total mineral production dropped 8.3 percent compared with the same month last year, Statistics South Africa data showed on Thursday.
Platinum output, which has been hit heavily by strike action this year, fell 17.8 percent. South Africa is the source of around three-quarters of the world's platinum supply.
In other precious metals, spot platinum was down 0.16 percent at $1,536.49 and spot palladium fell 1.1 percent to $602.7.
Silver fell 0.28 percent to $31.67 an ounce.