Bullion bears hold on to short positions

Gold prices rise 4% this month but physical demand moderates

Gold prices are the highest since November in the international market and in India, too, the year has begun with prices still in a positive territory. 

However, punters in the market are not so optimistic in India, with most having bearish positions on the Multi Commodity Exchange (MCX) holding on their short sales by paying a margin. Globally, too, except some Chinese buying, follow-up demand from physical buyers is moderate.

Data on the MCX, the leading exchange for trading in gold derivatives, show that bearish open positions have not come down in the past two weeks, despite prices strengthening. Open interest (OI,