MUMBAI: Gold edged higher on Wednesday afternoon boosted by firm overseas markets, though a stronger rupee at home reigned in the upside, keeping physical traders at bay, dealers said. At 3:10 p.m., the most-active gold for December delivery on the Multi Commodity Exchange (MCX) was 0.50 per cent higher at 27,663 rupees per 100 kg, after hitting a high of 27,634 rupees, a level last seen on Oct. 28. Overseas gold prices firmed, riding on renewed safe-haven demand as fears about Greece's debt crisis returned after its government shocked the markets with a call for a referendum on a European Union aid deal. Rupee bounced back, tracking local shares which recovered on foreign fund inflows, while gains in the euro also aided. The rupee plays an important role in determining the landed cost of the yellow metal, which is quoted in dollars. Physical buying retreated in India, the world's biggest buyer of bullion, as traders awaited for price falls seeking to stock for the wedding season, which will last till December. "Physical players seem off today, and demand cooled a bit," said a dealer with a private importing bank in Mumbai. "Prices are slightly higher, and they are convinced about limited upside, they could get active close to $1,700 (an ounce)again," said the dealer.

Source