Gold prices drop to R 28,940; silver loses R 200

Gold dipped below the psychological Rs 29,000-level in the bullion market here on Wednesday on sustained selling by stockists in tandem with a steep fall in precious metals in global markets.

Gold prices declined by Rs 100 to Rs 28,940 per 10 grams, while silver lost Rs 200 to Rs 55,800 per kg on reduced offtake by industrial units and jewellers.

Traders said selling in gold gathered momentum after it slumped to a seven-week low in global markets, as the dollar’s rally eroded demand for the precious metal as an alternative investment.

Gold plunged by $34.40 to $1,630.90 an ounce, while silver lost 1.44 per cent to $30.84 dollar an ounce in New York last night.

In addition, retail customer’s refrained from purchasing the precious metals at existing higher levels, which further dampened the sentiment.

Back home, gold of 99.9 and 99.5 per cent lost Rs 100 each to Rs 28,940 and Rs 28,800 per 10 grams.

The metal has lost Rs 290 in last two days.

Sovereign held steady at Rs 23,300 per piece of eight grams.

Likewise, silver ready declined by Rs 200 to Rs 55,800 per kg and weekly-based delivery shed Rs 5 to Rs 56,415 per kg.

Silver coins dropped by Rs 1,000 to Rs 62,000 for buying and Rs 63,000 for selling of 100 pieces.

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Rupee in free fall, hits fresh all-time low of 53.75 a dollar

The rupee tanked 52 paise to a record low of Rs 53.75/dollar in early trade today, a day after breaching the Rs 53 per dollar-mark, on increased demand for the American currency from banks and importers and sustained foreign capital outflows amid an economic slowdown.

Dollar gains against the euro and other currency rivals overseas amid the lingering euro zone debt crisis put pressure on the rupee, forex dealers said.

In addition, continued foreign capital outflows amid a slowdown of the domestic economy contributed to the weak rupee sentiment, they said.

Furthermore, increased demand for the US currency from importers and banks led to the fall in the rupee value in early trade, the forex dealers added.

The domestic currency had depreciated by 39 paise to close at Rs 53.23/24 per dollar in the previous session after witnessing an all-time low of Rs 53.51 as the dollar strengthened in markets worldwide.

Meanwhile, the BSE benchmark Sensex recovered by 65.19 points, or 0.41%, to 15,937.32 in opening trade on Wednesday.

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