MUMBAI: Gold buying stayed weak for a second day as traders awaited price falls to re-stock for the upcoming festivals in August, dealers said on Friday. "Volumes are very thin, I must have done only 20 kgs from morning," said a official with a state-run bullion dealing bank.
International gold, which guides the domestic markets, was trading $1,199.75/1,121.15 at 1:54 p.m. as against the previous close of $1,195.35/$1,196.35. Gold held firm as the market waited to hear about European bank stress test results, but the precious metal was expected to come under pressure from a stronger dollar against the euro.
However a strong rupee, which makes the dollar-quoted gold cheaper, also helped sentiment. The Indian rupee strengthened to its highest level in a week boosted by a return of some risk appetite globally after a slew of strong data in Europe, but traders would watch European banks' stress test results for cues.
India, which accounts for more than 20 percent of global demand, will celebrate the Hindu festival of Raksha Bandhan on Aug. 24, and Janmasthami and Ganesh Chaturthi in September.
