Gold at record high on global cues

Propelled by wedding season demand, the price of the precious metal nears Rs 30,000 per 10g.

Gold on Thursday rallied to an all-time high of Rs 29,540 per 10g in the bullion market here, by adding Rs 240 on the back of wedding season demand amid firm global trend.

The precious metal has surpassed its previous record of Rs 29,490 per 10g set on December 2. On the other hand, silver declined by Rs 150 to Rs 56,250 a kg on lack of necessary buying support.

In addition, increased buying by jewellery makers to meet the ongoing marriage season and shifting of funds by investors from melting equities to bullion also supported the upswing, traders said.

Gold of 99.9 and 99.5 per cent purity climbed by Rs 240 each to record highs of Rs 29,540 and Rs 29,400 per 10g, respectively. Sovereigns rose by Rs 50 to Rs 23,400 per piece of eight grammes.

Meanwhile, silver ready declined by Rs 150 to Rs 56,250 a kg on lack of support at existing levels.

However, silver weekly-based delivery rose by Rs 150 to Rs 57,350 per kg on speculative buying. Silver coins remained steady at Rs 63,000 for buying and Rs 64,000 for selling of 100 pieces.

In international markets, gold edged higher in thin choppy trade on Wednesday, as investors stayed on the sidelines ahead of a European Central Bank policy meeting and a European summit aimed at resolving the region's debt crisis.

Bullion gyrated near the unchanged level and trading volume was on track to come sharply below its 30-day average, as pessimistic comments from Germany and new data exposing growing stress among European banks pressured equity markets.

Technical support helped lift gold prices after the metal reclaimed support of the 100-day moving average. But analysts said gold could decline if the stock markets turned bullish.

“Should enthusiasm for equity's safety increase in any measurable way, we feel the post knee-jerk reaction would be negative for gold,” said Rick Bensignor, chief market strategist of Merlin Securities.

Spot gold rose 0.4 per cent to $1,734 an ounce by 11:49 am EST (1649 GMT), on track for a second consecutive day of gains.

US gold futures for February delivery were up $6.20 at $1,738 an ounce.

On Tuesday, gold rose after Standard & Poor's put the credit ratings of all euro zone members including core economies Germa-ny and France under review for possible downgrade. Spot silver fell 0.6 per cent to $32.52.