(REUTERS) -- Gold demand in India, the world's top buyer, remained subdued on Friday after prices edged higher, tracking a rebound in the world market and as the local currency pared early gains, dealers said.
The most-active February gold contract on the Multi Commodity Exchange was 0.24 percent higher at 27,764 rupees per 10 grams by 4:44 p.m.
Demand was weak. All of my counters today reported poor sales. Sharp drop in prices is required to boost the demand, said a Chennai-based wholesaler.
In some parts of the country demand was weak due to Khar Mass, dealers said. Khar Mass is a month in the Hindu calendar, observed from December 16 to January 14, considered inauspicious for gold buying and starting new ventures.
International spot gold inched higher on Friday in thin trade, taking cues from higher equities after upbeat U.S. economic data encouraged investors, while the persistent gloom hanging over the euro zone weighed on sentiment.
The rupee plays an important role in determining the landed cost of the dollar-quoted yellow metal. The rupee was at 52.86 to the dollar by 4:44 p.m., weaker than its 52.72/73 close on Thursday.
A Reuters poll of 20 hedge fund managers, economists and traders showed international spot gold prices are expected to fall below $1,500 an ounce over the next three months and they are unlikely to retest September's all-time highs until later 2012 at the earliest.