Gold futures fall on global cues

Gold futures dropped on Monday tracking global prices, which fell on expectations that an improvement in the US economy would lower demand for the yellow metal.

 

At 3:38 p.m., the most-active gold for February delivery was down 0.47 per cent at Rs 28,426 per 10 grams on Multi Commodity Exchange.

 

Silver for March delivery was down 1.59 per cent at Rs 44,432 per kg.

 

International gold edged lower, heading for its biggest annual loss in more than three decades at nearly 30 per cent, as firm equities and the prospect of a recovery in the global economy stole its shine.

 

The partially convertible rupee, which plays a key role in determining the landed cost of the dollar-quoted metal, edged lower as a large state-run bank likely bought dollars on behalf of oil refiners.

 

"Gold-exchange traded fund outflows also indicate weaker investor interest," Kotak Commodity Services analysts wrote in a note.

 

"However, choppiness in the US dollar has lent some support. Gold may continue to trade weaker on Monday on optimism about the US economy."

 

Indian gold imports may fall 70 per cent in the final quarter of 2013 from 255 tonnes in the year-ago period and are expected to be half the usual levels at 500-550 tonnes next year if new import rules are maintained, a top trade body official said.

 

To curb India's rising trade deficit, the government slapped a record import duty of 10 per cent earlier this year and tied imports for domestic consumption with exports.

 

Copyright @ Thomson Reuters 2013