MUMBAI: Benchmark gold futures rose 1.26 per cent on Thursday to hit a new peak, driving away physical traders seeking to stock the yellow metal in the middle of the festive season.
The key gold for October delivery on the Multi Commodity Exchange ( MCX) hit its peak at Rs 30,699 per 10 grams, before trading 1.09 per cent higher at Rs 30,646, backed by overseas leads, though a stronger rupee kept the upside limited.
Global gold rose to their highest levels in more than three months on Thursday, shaking off months of lethargy after minutes from the latest U.S. Federal Reserve meeting fuelled hopes for the swift launch of more bond buying.
The rupee, which rose to an over one-week high on Thursday, plays an important role in determining the landed cost of the dollar-quoted yellow metal.
"Buying is nil and there will be more of scrap," said Ketan Shroff, director with Pushpak Bullion in Mumbai.
Festival season is underway in India, the world's biggest consumer, and will continue till November. Weddings also take place during this period. Gold sales are expected to fall 40 per cent during this period to 200 tonnes.
Gold imports have already halved so far this year and a likely drought could further dent rural demand. Rural areas, which depend on monsoon rains for yields and income, contribute to about 60 per cent of the country's demand.
In the spot market, HDFC Bank quoted Rs 30,825 per 10 grams, up about Rs 300 from previous close.
Silver also surged more than 2.5 per cent to hit its highest level in four months, following the yellow metal.
The most-traded silver contract for September delivery was 2.53 per cent higher at Rs 56,710 per kg, after hitting a high of Rs 56,856, a level last seen on April 19.
