Indian gold futures are likely to surge past their highest level in two weeks, helped by expectations of a further depreciation in the rupee.
The most-active gold for August delivery on the Multi Commodity Exchange (MCX) hit a high of Rs 29,397 per 10 grams, a level last seen on July 11. At 9:26 GMT, gold was trading up 0.26% at Rs 29,354 per 10 grams.
"Gold will undoubtedly find support from the rupee's depreciation, and also, some support from Russian central bank buying," said Gnanasekar Thiagarajan, director with Mumbai-based Commtrendz Research.
Buying is recommended in gold on a dip to Rs 29,250, for a target of Rs 29,400-29,500, with a stop loss at Rs 29,100, said Thiagarajan.
The rupee, which hit its lowest level in a week, plays an important role in determining the landed cost of the dollar-quoted yellow metal.
In the overseas market, Russia's central bank raised its gold reserves by 6.2 tonnes to 836.3 tonnes in June. Central-bank buying has underpinned gold's rallies in the last several years.
Silver futures, which traded steady on Monday, could fall due to a weakness in base metals. Silver for September delivery on the MCX was trading 0.12% lower at Rs 52,778 per kg.
Selling is advised in silver on rallies to Rs 52,800, for a target of Rs 51,900, said Thiagarajan.
