Gold Touches Five-Year Low, Metals Steady

Gold prices dropped to touch a five year low level of Rs 4,060 per ten grams on the bullion market yesterday following a steep fall in London prices.

In London, the yellow metal fell below the psychological mark of $300, and was fixed at $297 for the first time in 12-1/2 years, dealers said.

Silver also fell sharply by Rs 105 per kilo on adequate stock position due to increased arrivals coupled with weak overseas advices.

Standard gold fell by Rs 30 to close at Rs 4060 as against the last close of Rs 4090. 22-carat gold was quoted lower by Rs 30 at Rs 3755, while ten-tola gold bar of .999 purity fell by Rs 400 to end at Rs 47,500 as against the last close of Rs 47,900.

Silver ready of .999 fineness, silver raw of .916 fineness and tenderable silver declined steeply by Rs 105 each to finish at Rs 7265, Rs 7165 and Rs 7270 from the previous close of Rs 7370, Rs 7270 and Rs 7375 respectively.

Oil & Oilseeds: Market operators protests for a switch to twice weekly clearing from daily clearing meant castorseed for forward delivery was untraded on Wednesday, traders said.

"Agitation against daily clearing has gone on for a week and trading remains suspended," one trader said.

"The undertone continues to remain firm. Supplies were thin and there was increased overseas enquiries for castoroil following the dollar's rise against the rupee," said Praful Mody, a leading dealer.

Groundnut oil rose by a rupee to Rs 334/335 per 10 kg on eased supplies due to lower loading from the producing centres as traders agitated against a service tax imposed by the government.

In Rajkot, it rose by five rupees to Rs 505 per 15 kg.

Imported palm oil looked up by two rupees to Rs 276/277 per 10 kg on absence of fresh arrivals at Mumbai port while the stronger dollar against rupee has increased the lending cost of imported oil.

Non-ferrous metals: Base metals held steady on the markets on Wednesday consolidating recent gains, dealers said.

Industrial demand has retreated but thin supplies and the rupee's fall against the dollar kept offerings low, they said.

"The strong dollar has increased the lending cost of imported metals," said Sharad Parikh, a leading dealer.

Copper was steady at Rs 12,200 per quintal after gaining Rs 50 on Tuesday while zinc was steady at Rs 7,600 after gaining Rs 50 rupees on Tuesday.

"Limited arrivals also helped prices to consolidate recent gains in the base metals," Parikh said.

Tin was quiet at Rs 32,500 after gaining Rs 400 on Tuesday while nickel was steady at Rs 31,900 after gaining Rs 300 on Tuesday.

Aluminium was steady at Rs 8,250 rupees as was lead at Rs 4,100 per quintal amid nominal trade while overall market sentiments was firm at the close of the session.