Gold extends gains; rises on high buying activity

Gold extends gains; rises on high buying activity
Gold prices extended gains, rising by 0.57 per cent on Monday at the domestic markets as traders and speculators created fresh positions in the bullion amid hopes of a pickup in physical demand ahead of the auspicious gold buying festival of Akshaya Tritiya.

Gold futures for June 2013 contract, at MCX, were trading at Rs. 27,166 per 10 grams, up by 0.57 per cent after opening at Rs. 27,006 against the previous closing price of Rs. 26,962. It touched the intra-day high of Rs. 27,124 till the trading. (At 11.34 AM today).

Sentiment improved further as weaker greenback makes gold cheaper for those holding other currencies, thus increasing demand. The U.S. dollar index, a measure of the value of the United States dollar relative to a basket of foreign currencies was trading 0.06 per cent lower at 82.075 on the Inter-Continental Exchange (ICE) at 11.17 am IST.

However, gains in the yellow metal were curbed by concerns that the US Fed may scale back asset purchases as the upbeat labour market data signaled job market progress, dimming the appeal of the bullion, a hedge against the inflationary risk of monetary stimulus. US employers added 165,000 workers in April 2013, up from 138,000 in March 2013, the Labour Department said in a report.

At the Commodity Exchange (COMEX), gold future for June 2013 delivery traded at US$1,476.1 per ounce, up by 0.81 per cent. It opened at US$1,470 against the previous closing price of US$1,464.2. It touched the intra-day high of US$1,478.4. (At 11.38 am IST).

Read more about: gold, futures
Story first published: Monday, May 6, 2013, 13:30 [IST]
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