MUMBAI: India s gold demand revived as spot and future prices of gold eased following a rate cut in the US that boosted global stock and currency markets.
It encouraged local traders to pick up small quantities for near term needs. Overseas gold fell by more than 2 per cent as the US Fed cut interest rates by 75 basis points, lifting other asset classes and diminishing bullion's appeal as an alternative investment.
Dealers in bullion banks also said demand had revived late on Tuesday when prices dipped to a one week low. One dealer in a private bank said most of the sales were made in the range of $986 $992 an ounce.
India's wedding season has necessitated gold purchases, though most of the buyers have preferred to recycle old gold rather than buy new metal, denting demand for imported stocks.
Gold was subdued in futures market with the April contract on the Multi Commodity Exchange of India opening at Rs13135 but traded at 12900 levels.
Open interest for the benchmark April contract was at 9,199 lots, up from 8,874 on Tuesday. Volume on the previous day was at 42.27 kg