MUMBAI (Commodity Online): Indian gold market this week witnessed some busy business as the festival season is nearing fast. India will celebrate Raksha Bandhan on August 24 and the southern state of Kerala, which is the largest consumer of yellow metal in India, will celebrate Onam on August 23.
Riding on this festival demand, gold prices gained a bit in Indian markets. However, gold buying retreated on Friday afternoon as traders awaited a fall in prices, while a weaker rupee, which made the dollar-quoted asset expensive, weighed on sentiment.
Although there are traders and consumers looking to buy gold with festivals coming up, the 6 percent jump in the past three weeks have left some buyers expecting some correction.
International gold, which guides the domestic market, was trading at $1,230.70/1,231.40 an ounce on Friday.
Gold rose on Friday, holding near a 1.5 month high hit the previous day as worries about a deepening US economic slowdown helped push up holdings in the world's largest ETF for the third consecutive day.
India gold traders are bracing for festivals starting next week, which will continue for next three months.
Extending gains for the ninth straight session, gold settled at Rs 18,985 per 10 gm on Friday, higher by Rs 35 over the previous close.
Sustained buying by stockists and jewellers in the last nine trading sessions brought the gold prices near to a psychological level last seen on July 1. A firming trend in overseas markets also influenced the uptrend.
The gold in overseas markets, which normally set the price trend on the domestic front, traded 35 cent higher at 1,232.50 dollar an ounce.
On the domestic front, gold of 99.9 per cent and 99.5 per cent purity rose further by Rs 35 each to Rs 18,985 and Rs 18,885 per ten gram respectively. Sovereigns continued to trade around previous levels of 14,800 per piece of eight grams in limited deals.
On the other hand, silver ready fell further by Rs 100 to Rs 29,600 per kg and weekly-based delivery by Rs 130 to Rs 29,185 per kg, silver coins remained steady at Rs 34,500 for buying and Rs 34,600 for selling of 100 pieces.