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India traders shrug off record gold prices, stock up

MUMBAI (Reuters) - India gold traders stocked up to meet demand in the wedding season that will last till December, hoping gold’s rally will continue from record high prices, even as scrap flow eased, dealers said on Thursday.

An employee looks out from a gold jewellery shop in New Delhi November 24, 2009. REUTERS/Rupak De Chowdhuri

“Our Chennai centre is seeing some activity, I have ordered for some additional stocks, which is expected today,” said a dealer with a state-run bank in Mumbai.

“Delhi is also responding to current levels,” added the dealer.

“Even at this level, demand has emerged, I did some 50-60 kgs so far in the day,” said another dealer with a bullion dealing state-run bank.

The most-traded December gold contract on the Multi Commodity Exchange (MCX) was trading 0.34 percent higher at 17,782 rupees per 10 grams at 2:15 p.m., after hitting a record high of 17,868 rupees earlier.

While a weak rupee, which makes the dollar-quoted asset expensive, weighed on sentiment, they added.

The Indian rupee dropped further in afternoon trade on Thursday, weighed by losses in domestic shares and also month-end dollar demand from banks.

The flow of scrap also eased as sellers sought higher prices, they added.

“No one is ready to sell now, in fact I have buyers for coins,” said Jitendra Kantilal, partner, Jugraj Kantilal, a scrap dealer in Zaveri Bazzar, which also sells coins.

(Reporting by Siddesh Mayenkar; Editing by Harish Nambiar)

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