Gold fails to outshine on Dhanteras; hits one-month low

Dhanteras - heralding the biggest gold buying festival - failed to light up consumers' buying spirit at the domestic bullion hub here.

Subdued demand from jewellery stockists and retail buyers in the midst of high volatile global situation mainly kept precious metals under pressure.

Despite domestic prices ruling at lower levels compared to last year, buyers preferred to stay on the sidelines awaiting further price dips amid global uncertainty.

The introduction of mega gold-related schemes — gold monetisation scheme and the sovereign gold bond scheme - by the government ahead of Dhanteras and Diwali that aimed at providing an alternative to buying physical gold, also took some sheen off yellow-metal, a bullion trader said.

Elsewhere, silver also fell back to close below the significant Rs 36,000-mark on the back of heavy speculative unwinding.

Dhanteras, the first day of the five-day Diwali festival, is extremely significant and customary buying of gold and silver jewellery are considered auspicious to augment this celebration.

Standard gold (99.5 purity) slumped by Rs 120 to end at Rs 25,800 per 10 grams - lowest level in one month as against Friday's closing level of Rs 25,920.

Pure gold (99.9 purity) also shed by a similar margin to settle at Rs 25,950 per 10 grams from Rs 26,070 previously.

Silver (.999 fineness) declined by Rs 150 per kg to finish at Rs 35,980 from Rs 36,130 previously.

In worldwide trade, the shiny-metal staged a modest rebound from its three-month low on heavy short-covering as well as value buying after a stronger-than-expected jobs data reinforced confidence for US Federal Reserve to raise its key interest rate target for the first time in nearly a decade.

Spot was trading higher at USD 1,093 an ounce in early European session, while silver quoted almost flat at USD 14.73 an ounce.