Gold extends losses; down Rs 200 on global cues, low demand

 Falling for the third straight day, gold prices tumbled by another Rs 200 to Rs 25,090 per ten gram at the bullion market today in line with a weakening global trend amid subdued demand from jewellers.

Silver also eased by Rs 150 to Rs 34,050 per kg on reduced offtake by industrial units and coin makers.

Traders said a weakening global trend where gold heading for its largest monthly decline in two years, as the Federal Reserve moved closer to boosting US interest rates for the first time since 2006, mainly kept pressure on precious metals prices.

Globally, gold fell 1.1 per cent to USD 1,084.51 an ounce and silver by 1 per cent to USD 14.66 an ounce in Singapore.

Besides, fall in demand from jewellers and retailers who deferred their buying plans in anticipation of further dip in prices, dampened the sentiment to some extent, they said.

In the national capital, gold of 99.9 and 99.5 per cent purity dipped by Rs 200 each to Rs 25,090 and Rs 24,940 per ten grams respectively. It had lost Rs 200 in last two days.

Sovereign, however, held steady at Rs 22,200 per piece of eight gram in limited deals.
Meanwhile, gold prices in the country may even dip to Rs 20,500 per 10 grams, a level last seen about five years ago, in case of a rate hike by US Federal Reserve later this year, according to India Ratings and Research.

Following gold, silver ready declined by Rs 150 to Rs 34,050 per kg and weekly-based delivery by Rs 70 to Rs 33,780 per kg.

Silver coins also dropped by Rs 1,000 to Rs 48,000 for buying and Rs 49,000 for selling of 100 pieces.