Gold climbs on weak rupee; up by Rs 70 per 10 gram

KOLKATA: A weak rupee pushed up gold prices in the spot and futures markets on Wednesday.

Gold was up Rs 70 per 10 gm at Rs 27,820 at 5.40pm. Analysts said it is expected to stay above Rs 27,000 until the government presents the Union Budget in July.

In the international market, gold steadied at $1271.32 an ounce ahead of the end of Wednesday’s FOMC meeting where the US Federal Reserve is likely to pare $10 billion from its monthly bond purchases because of high inflation. Markets are also anticipating some hints as to when the Fed could raise interest rates.

Back home, a weaker rupee could offset any likely fall in the international price, said Sudheesh Nambiath, analyst at GFMS Thomson Reuters, a precious metals analytical company.

Domestic demand has been weak ahead of anticipated duty rate cut during the Budget, even as supply has slowed a bit due to restrictions on imports by the government, said analysts.