MUMBAI: Gold buying continued to be slack on Wednesday afternoon as prices traded near the most-watched Rs 19,000 mark, with a weaker rupee also weighing on sentiment, dealers said.
"It's all dull at the moment because of high prices and monsoon. There was buying in bits and pieces yesterday, when gold was below $1,230 (an ounce)," said a dealer with a state-run bullion dealing bank. The August gold contract on the Multi Commodity Exchange (MCX) was trading 0.07 percent higher at Rs 18,870 per 10 grams, after hitting a high of Rs 18,880, not far from the psychological level of 19,000 rupees.
The rupee dropped to its lowest level in two weeks, weighed by early losses in local shares and weak regional peers. Traders said the dollar's moves versus majors would be watched for cues. A weak rupee makes the dollar-denominated asset expensive.
India is entering the lean season for gold deals as the annual monsoon rains sweep the country, and farmers, who account for 65 per cent of the country's gold demand, spend their money on sowing crop. "We can see more buying if prices fall in the range of $1,230-1,235 (an ounce)," said another dealer with a private bank.
