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Gold futures edge up to near one-week high

Source : REUTERS
Last Updated: Tue, Jun 18, 2013 08:38 hrs
A worker counts gold bangles at a jewellery-making workshop in Jammu

Gold futures edged up on Tuesday to their highest in nearly a week, helped by a weaker rupee, which was not far from its record low. Silver also moved higher.

The actively traded gold for August delivery on the Multi Commodity Exchange (MCX) was 0.60 percent higher at 28,037 rupees per 10 gram at 1:36 p.m., after hitting a high of 28,087 rupees earlier, the highest since June 13.

The rupee, which was in the vicinity of its record low, plays an important role in determining the landed cost of the dollar-quoted yellow metal.

However, in the overseas market, gold slipped for a second session as muted physical demand weighed on prices.

Investors are closely watching the U.S. Federal Reserve's two-day policy meeting that begins later in the day as a string of healthy U.S. data has increased speculation the bank could scale back its bond-buying programme, hurting gold's appeal as a hedge against inflation.

Silver for July delivery on the MCX was 0.72 percent higher at 43,912 rupees per kilogram.

In the physical market, demand remained weak after the government raised import duty by a third to 8 percent, following a ban on consignment imports by the central bank.

"There is no business due to off-season... Supplies will slow down in the coming months," said Haresh Acharya, head of bullion desk at Parker Bullion, a wholesaler in Ahmedabad.

Gold imports fell from an average of $135 million in the first half of May to $36 million in the second half, Finance Minister P. Chidambaram said.


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