Gold fell below the Rs 28,000 per 10g level for the first time in six weeks here on Friday, losing Rs 375 to Rs 27,765 per 10g on sustained selling, amid reduced offtake at higher levels and a weakening global trend.
Prices fell due to a rise in the rupee against the dollar following stringent measures announced by the Reserve Bank of India yesterday. On Friday, the rupee appreciated 1.7 per cent making import cost of gold cheaper, which was also reflected in prices. Falling for the fifth straight day, prices declined to levels last seen on November 3 as stockists offloaded their positions, taking cues from a steep fall in global markets and low demand.
The precious metal has lost Rs 1,565 in the past five sessions. It had touched a record high of Rs 29,540 per 10g on December 8. However, silver prices rose by Rs 500 to Rs 53,100 a kg, on fresh buying by industrial units and jewellers.
Marketmen said sustained selling by stockists, in tandem with a weakening global trend, mainly pulled gold prices below the Rs 28,000 per 10g-mark. Gold in global markets, which normally sets the trend on the domestic front, fell by $5.90 to $1,570.60 an ounce in New York last night, as investors refrained from fresh buying amid a deepening euro zone debt crisis.
In addition, the end of the marriage and festival season and lower demand from retail customers expecting a further correction in prices influenced market sentiment to some extent.
On the domestic front, gold of 99.9 per cent and 99.5 per cent purity remained under selling pressure and plunged to Rs 27,765 and Rs 27,625 per 10g, respectively. However, sovereigns held steady at Rs 23,200 per piece of eight grammes.
