Gold prices may surge past 15-week high

Gold prices in India, the world's biggest buyer of the metal, could rise past their highest level in more than 15 weeks on Tuesday, helped by a weakness in the local currency. The rupee, which weakened past 60 to a dollar again, plays an important role in determining the cost of gold.

By Reuters
30 Jul, 2013, 06.12PM IST
Economic Times

MUMBAI: Gold prices in India, the world's biggest buyer of the metal, could rise past their highest level in more than 15 weeks hit on Tuesday, helped by a weakness in the local currency, traders said.

At 1141 GMT, the actively traded gold for August delivery on the Multi Commodity Exchange (MCX) was 0.71 per cent higher at Rs 28,478 ($480) per 10 grams, after hitting Rs 28,479, the highest since April 12.

"Mostly rupee weakness will contribute to local price strength. Also, due to the recent measures, spot prices are at a premium," said Gnanasekar Thiagarajan, director with Commtrendz Research in Mumbai.

The rupee, which weakened past 60 to a dollar again, plays an important role in determining the landed cost of the yellow metal. Imports of the yellow metal has halted after the central bank tied gold imports to exports last week, pushing premiums to about $45 an ounce on London prices.

Buying is advised in August gold at Rs 28,250, for a stop loss of Rs 28,100, and targeting Rs 28,700, said Thiagarajan.

Silver for September delivery on the MCX was 0.03 percent higher at Rs 41,158 per kg.

Thiagarajan suggests buying silver above 42,000, with a stop loss of 41,500, targeting Rs 43,000.

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