Gold tumbles further on rupee, overseas leads

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Mumbai: India gold futures extended losses for the fourth straight session on Wednesday tracking weak global markets and a firm rupee, analysts said.

"The overall trend in gold is still bearish," said Harish Galipelli, head of research at Karvy Comtrade Ltd., adding that there could be a temporary bounce-back.

The benchmark February contract on the MCX has shed around 4 per cent during the previous three sessions.

Overseas gold fell more than 1 per cent on Wednesday, defying a rebound in oil prices, after the US dollar bounced against the euro and speculators in Japan shifted some of their money back to stocks.

A firm rupee is also weighing on local prices as most of India's gold requirement is imported and paid for in the US currency.

The Indian rupee strengthened past 50 per dollar in early trade on Wednesday on hopes of some foreign inflows into the local share market, but then eased as stocks failed to follow overseas leads.

MCX February gold may trade in the range of 12,000-13,000 rupees in the short to medium term, Galipelli added.

Open interest in February gold was at 11,887 lots, up from 11,704 a day earlier. Volume on Tuesday was 55.58 kgs.