Gold prices nudge up on demand, rupee flip-flop

Last Updated: Tue, Nov 20, 2012 09:15 hrs

Gold prices in India, the world's biggest buyer of bullion, edged up on Tuesday, buoyed by wedding season demand and as the rupee gave up all earlier gains against the dollar in intra-day trade.

At 2:01 p.m., the most active gold for December delivery on the Multi Commodity Exchange (MCX) was 0.33 percent higher at 31,803 rupees per 10 grams.

The rupee, which flip-flopped against the dollar on Tuesday, plays an important role in determining the landed cost of the dollar-quoted yellow metal.

"It should be a rangebound market. I do not see the physical market crossing the 32,500 level soon," said a dealer with a private-sector bank.

The ongoing wedding season will taper off in December.

Overseas gold traded steady on Tuesday following its biggest one-day rise in two weeks, supported by hopes of a U.S. solution to its fiscal problems and Middle East tension, but weighed down by a firmer dollar as a result of France's rating downgrade.

Silver also rose on Tuesday. Silver for December delivery on the MCX was 0.40 percent higher at 61,841 rupees per kg.

Bullion spot prices were unavailable on Monday as some sections of the market were closed in the main trading area of Zaveri Bazaar in Mumbai, following the death of a key regional political party leader in the western Indian city over the weekend.

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