Indian gold traders clear old stocks as prices hit 5-month low
* The weddings and festivals season has started in India, but the federal government plans to restrict gold buying by announcing more measures in addition to a 50 percent hike in import duty to keep a lid on its bloating current account deficit.
* Traders had accumulated stocks, when the finance minister hinted of a duty hike on Jan. 2, and later raised the duty on Jan. 21.
* The actively traded gold contract for April delivery on the Multi Commodity Exchange (MCX) was 0.30 percent lower at 30.505 rupees per 10 grams as of 0909 GMT, after hitting a low of 30,487 rupees, a level last seen on August. 20.
* The rupee, which hit the highest level in more than three-and-a-half-months, plays an important role in determining the landed cost of the dollar-quoted yellow metal.
* "Not many deals are happening as market has to clear the old stocks, which could finish this week," said a dealer with a state-run bullion importing bank in Mumbai.
* However, in the overseas markets, gold ticked up, but failed to climb above a recent narrow trading range as mostly upbeat U.S. data took some shine off the precious metal, which withers when economic recovery gains traction.
* Silver contract for March delivery
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