Gold futures hit over seven-month high

Last Updated: Mon, Aug 19, 2013 11:55 hrs

Gold prices in India, the world's biggest buyer of the metal, hit their highest level in more than seven months, helped by a rupee that weakened to a record low again.

The actively traded gold contract for October delivery on the Multi Commodity Exchange (MCX) was 0.1 percent lower at 30,809 rupees per 10 grams, after hitting a high of 31,000 rupees earlier in the day, a level last seen on January 7.

The rupee, which plays an important role in determining the landed cost of the dollar-quoted yellow metal, looked poised for further losses, with a series of measures unveiled last week failing to stall its decline.

Overseas gold hit fresh two-month highs, helped by weak U.S. data that increased the metal's safe-haven appeal, and further inflows into the world's biggest bullion-backed exchange traded fund (ETF).

In the domestic market, demand remained subdued amid circular from the Reserve Bank of India clarifying a July order for imports, while premiums remained steady.

"Demand is zero ... there could be demand after 15 days," said Suresh Jain, director of Bombay Bullion Association.

India turned the screw on gold buying again, banning imports of coins and medallions and making domestic buyers pay cash, after hiking bullion import duty to a record 10 percent.

Silver for September delivery on the MCX was 0.05 percent lower at 50,635 rupees per kg.

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