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Depreciating rupee made gold costlier in India by 1% hitting 3 ½-month high on Tuesday despite thin buying from both stockists and retailers.
Standard gold in Mumbai’s popular Zaveri Bazaar shot up by Rs 285 to touch Rs 28,500 per 10 gram, the level not seen since April 12, 2013. While stockists abstained from fresh purchases amid expectations of an imminent fall, retail consumers await festivals to commence buying.
“The decline in rupee was the major factor gold price rise,” Lalit Jagawat, Proprietor of Nakoda Bullion and Director of the Bombay Bullion Association (BBA).
After the Reserve Bank of India (RBI) government announced the quarterly monetary policy on Tuesday, the rupee fell 1.80% to close at 60.49 against the dollar.
June-July is considered generally as lean season for gold sales. During this period, gold sales generally remain lower. But, the RBI’s restrictions on gold import pushed the market sentiment further down with buyers almost deserted from the street.
