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Gold futures fall to near four-week low

Source : REUTERS
Last Updated: Tue, Jun 25, 2013 11:48 hrs
Salesgirl is reflected in a mirror inside a gold jewellery showroom on occasion of Akshaya Tritiya in Kochi

Gold futures in India, the world's biggest buyer of the metal, extended losses to their lowest level in nearly four weeks, in line with global markets.

At 3:57 p.m, the most-active gold for August delivery on the Multi Commodity Exchange (MCX) was 0.27 percent lower at 26,654 rupees per 10 grams, after hitting a low of 26,541 rupees, a level last seen on May 29.

Global gold reversed early gains as worries persisted over an early end to U.S. monetary stimulus measures and a cash crunch in China, bringing the metal's losses to more than 8 percent since the start of last week.

A slightly firmer rupee also weighed on prices. The rupee plays an important role in determining the landed cost of gold.

"Demand has slowed... people are waiting for the price level of 26,000 rupees (per 10 grams)," said SK Jain, president of Chandani Chowk Jewellers Association.

India imposed a ban on consignment imports in May, but has ruled out a blanket ban on gold imports or any increase in customs duty from the current 8 percent.

India's biggest trade body representing jewellers urged sellers to stop selling gold coins and bars, a few days after Reliance Capital suspended its gold sales.

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

Silver for July delivery on the MCX was 0.11 percent lower at 40,788 rupees per kilogram.

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