Gold demand improves as jewellers buy for festival

Last Updated: Thu, May 02, 2013 11:39 hrs

Demand for gold in India, the world's biggest consumer of the precious metal, improved on Thursday as prices hovered near their lowest level in a week ahead of key festival Akshaya Tritiya.

The key June contract on the Multi Commodity Exchange (MCX) was 0.63 percent up at 26,711 rupees per 10 gram at 4:51 p.m., after hitting a one-week low of 26,365 rupees late on Wednesday.

"Jewellers are making last-minute buying for Akshaya Tritiya. But some buyers are waiting for bigger correction. They are waiting for prices to drop below 26,000 rupees," said a Mumbai-based dealer with a private bullion importing bank.

Indians celebrate Akshaya Tritiya in the third week of May, a time considered auspicious to buy gold, while the current wedding season continues until July.

The rupee, which plays an important role in determining the landed cost of dollar quoted yellow metal, eased on Thursday.

In the overseas market, gold held near its weakest level in almost a week, after declines in holdings of exchange-traded funds, equities and other commodities overshadowed the U.S. Federal Reserve's decision to maintain its loose monetary policy.

Silver for May delivery on the MCX was 1.24 percent higher at 44,200 rupees per kg.

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