Gold trades flat, importers seek price direction

Last Updated: Mon, Mar 11, 2013 09:22 hrs

Gold prices in India, the world's biggest importer of the yellow metal, were steady on Monday as support from overseas market was offset by a stronger rupee at home, with importers seeking price direction amid tight liquidity condition before the year end.

India has been trying to curb imports of gold, which has been called a dead investment by the federal government, to put a lid on record high current account deficit by hiking import duty by 50 percent to 6 percent in January.

At 2:22 p.m., the actively traded gold for April delivery on the Multi Commodity Exchange (MCX) was flat at 29,344 rupees per 10 grams.

"Some buying was there after Friday's fall, but today there is nothing as rupee didn't open at comfortable level and even gold prices went up," said a dealer with a state-run bullion dealing importing bank.

The rupee, which traded stronger on Monday, plays an important role in determining the landed cost of the dollar-quoted yellow metal.

Weddings and festivals will re-start next month and will continue till early June.

Silver for May delivery on the MCX was 0.09 percent lower at 54,805 rupees per kg.

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