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Indian gold traders step up buying as prices drop

MUMBAI | Mon Feb 6, 2012 3:49pm IST

(Reuters) – Gold demand in India, the world’s biggest buyer of the yellow metal, edged up as prices extended losses for a third straight session, spurring traders to stock up given the wedding season.

* The most-active gold for April delivery on the Multi Commodity Exchange (MCX) was trading 0.03 percent lower at 27,883 rupees per 10 grams at 3:30 p.m., after losing nearly 1 percent in the previous two sessions.

* “Deals are there today as well …. Activity is there in the market at $1,718-1,725 (an ounce),” said Pinakin Vyas, assistant vice-president with gold importing IndusInd Bank. “Advanced orders are there at $1,700 levels, but traders are also looking at the movement in the rupee”.

* The rupee, which weakened on Monday, plays an important role in determining the landed cost of the dollar-quoted yellow metal.

* Silver for March delivery was 0.18 percent lower at 56,055 rupees per kg.

* The wedding season will go on until May, raising expectations of higher demand for gold. There are also a number festivals during this period.

(Reporting by Siddesh Mayenkar; editing by Malini Menon)