Gold futures edge down on global cues; demand thin

Last Updated: Tue, Mar 26, 2013 10:02 hrs

Gold futures in India nudged lower on global cues amid thin demand, with the rupee's weakness against the dollar weighing.

The dollar and gold often move in opposite directions as the two compete for funds globally.

Traders said they expect the market to remain largely lacklustre until mid-April, when jewellers begin to stock up for Akshaya Tritiya -- the second most auspicious gold buying day after Dhanteras -- which falls on May 13.

India, the world's biggest buyer of gold, has been trying to trim imports as it battles a record high current account deficit. In January, it raised the import duty on gold by 50 percent to 6 percent.

f there is more weakness in global prices, we could see some opportunistic buying from bullion traders," said a trader with a private sector bank.

At 0915 GMT, the most-actively traded gold for April delivery on the Multi Commodity Exchange (MCX) was lower on the day by 96 rupees at 29,492 rupees per 10 gram.

Gold inched down towards a key resistance level of $1,600 per ounce. Spot gold dipped 0.2 percent to $1,602.24 an ounce by 0712 GMT. U.S. gold fell 0.2 percent to $1,601.50.

The rupee weakened against the dollar to 54.35/36 compared with its 54.17/18 close on Monday. The rupee plays an important role in determining the landed cost of the dollar-quoted yellow metal.

Silver for May delivery on the MCX was 0.20 percent lower at 54,105 rupees per kg.

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