Indian Wholesale Gold Buying Goes Dormant Again

Despite somewhat of a pickup yesterday, according to a report by the Economic Times, Indian wholesale buying was listless today. Buyers are waiting for prices to fall further.

"Demand is not much at the moment. However, there was a slight pick-up yesterday at about $1,162-1,165," said a dealer with a state-run bank....They are expecting a fall to $1,135 in the evening, when they hope to buy," said another dealer with a private bank.

A weak rupee, which makes the dollar-quoted asset expensive, weighed on sentiment, they added. The Indian rupee was weaker in afternoon trade on Tuesday but recovered some losses as exporters sold dollars to take advantage of the sharp drop in the rupee over the last two sessions, but weak domestic shares prevented further gains.

I note, in passing, that the good-buy price point has shifted up to $1,135. This upshift is likely due to rupee appreciation, but it might be a result of $1,100 being written off as unrealistically low as of now.