Tuesday October 19, 2010

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By Sam Devraj  ( Assistant Editor )

Rush for gold: Traders ignore high prices

INDIA gold traders ignored the record high prices and bought today eyeing the demand increase seen during the festivals, dealers said.

Dollar buying by gold importers also had an effect on the rupee’s movement, they said.

“Demand is still there for gold, traders have been buying dollars in the market as well,’ said a dealer with a state-run bullion importing bank.

Gold is a dollar-quoted asset, and as India, the world’s largest consumer of the yellow metal, imports majority of its requirement, the rupee plays an important role in determining its landed cost.

“Yesterday, we did about 200 kg and the appetite has been good this time despite record prices,” said another dealer with a private bank in Mumbai.

State-run Indian trader MMTC Ltd expects to import more than 200 tonnes of gold in the current fiscal year to March 2011 on good demand seen in the current festival season despite high prices, its chairman said yesterday.

It is festival season in India, with Dhanteras - the day the jewellers register the highest gold sales in a year - slated early next month.

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