Seasonal demand buoys gold further

Gold maintained an upward march for the second straight day on Thursday in the bullion market here with prices rising by Rs 40 to Rs 11,550 per 10 grams on buying by jewellers in view of the current marriage season.

Standard gold and ornaments remained in demand and advanced by Rs 40 each to Rs 11,550 and Rs 11,400 per 10 grams, respectively. However, sovereign ruled flat at Rs 9,150 per eight-gram piece in limited deals.

A similar trend was witnessed in silver as silver ready strengthened by Rs 50 at Rs 20,350 a kg and silver weekly-based delivery by Rs 100 at Rs 20,820 a kg respectively.

On the other hand, silver coins enquired around last level of Rs 25,400 for buying and Rs 25,500 for selling of 100 coins on stray demand.

Marketmen said trading sentiment gathered momentum following reports of the precious metal rising in Asian markets on speculation that the US Federal Reserve may cut interest rates again when it meets on January 29.

In a surprise move, the Fed had cut the interest rate by 75 basis points on Tuesday, a fourth time since 2001, to revive economic growth, which will also increase the appeal of bullion as a hedge against the dollar.

Gold rose by $3.28 to $893.60 an ounce in the Asian market.

"Melting equity markets shifted a part of their funds in the bullion, considering it a safe haven during such crisis," said marketmen.