Gold demand wanes as prices hit 2-week high

A weaker rupee helped gold futures surge past their highest level in nearly a fortnight, hurting purchases by gold wholesalers, who had sought to stock for the festival season amid a gloomy import outlook.

* The most-active gold for August delivery on the Multi Commodity Exchange (MCX) hit a high of 29,397 rupees per 10 grams early Monday, the level last seen on July 11, before trading 0.37% higher at  Rs 29,386 per 10 grams at 0820 GMT.

* Imports of gold into India have been subdued so far this year, with occasional buying at sub-Rs 28,000 level.

* "Buying is zero as rupee has depreciated again," said Haresh Acharya, head of bullion desk, Parker Bullion in Ahmedabad, adding there could be compulsory buying for festivals.

* The rupee, which dropped to its lowest level in over a week, plays an important role in determining the landed cost of the dollar-quoted yellow metal.

* A below-average monsoon could impact farm incomes and thereby gold demand as most of the country's gold imports target rural areas.

* India's gold imports fell by over a half in the June quarter and could slide by a third over the next three months as prices inflated by a weak rupee and a 4 percent import duty encourage traders to use scrap, a Reuters poll showed.

* Silver edged lower following copper, another industrial metal.

* Silver for September delivery on the MCX was 0.27% lower at Rs 52,697 per kg.