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Physical gold demand turns dull after duty hike

MUMBAI (Reuters) - Indian gold futures edged lower on Thursday from their highest level in seven weeks hit in the previous session tracking global cues, while physical demand turned dull after New Delhi raised the import duty.

* The most-active gold for August delivery on the Multi Commodity Exchange (MCX) was 0.2 percent lower at 27,630 rupees per 10 gram. It had hit a high of 27,847 rupees on Wednesday, a level last seen on April 26.

* "Market is dull after the duty hike... Imports will stop for another two months," said Suresh Jain, the proprietor of SJ Jain Jewellers, a wholesaler in Mumbai.

* India, the biggest buyer of the metal, raised the import duty to 8 percent from 6 percent, after extending a ban on consignment imports to government-run agencies and trading houses from banks, in a series of measures to contain the record current account deficit.

* The government may take more steps if needed to curb gold inflows into the country, a senior finance ministry official said on Thursday.

* A weaker rupee kept the downside in prices limited. The rupee plays an important role in determining the landed cost of the dollar-quoted yellow metal.

* Silver for July delivery on the MCX was 0.33 percent lower at 44,081 rupees per kilogram.

* The following were the prices of gold and silver in rupees as of 16.15 local time in the spot market, quoted by HDFC Bank:

(Reporting by Siddesh Mayenkar; Editing by Subhranshu Sahu)

Published Date: Jun 07, 2013 00:15 AM | Updated Date: Jun 07, 2013 00:15 AM