Traders stock gold, silver for festive season despite highs

Gold and silver traders bought the metal at record prices to stock for the upcoming Akshaya Tritya, a gold buying festival, and the wedding season expected to extend till May, providing underlying support to world prices, dealers said.

The most-traded gold for June delivery on the Multi Commodity Exchange (MCX) was trading 0.02% higher at Rs 22,125 per 10 grams, after hitting a record of Rs 22,172 earlier in the day.

Silver prices also surged, extending the previous session's gains, to hit another record. The white metal struck a new record of Rs 73,600 per kg on Monday afternoon.

"I booked for 100 kg from morning at USD 1,538.5 (an ounce). Both my Delhi and Mumbai centres are active," said a dealer with a state-run bank in Mumbai dealing in bullion. "I have advance orders at USD 1,517."

Gold traders also bought dollars in the foreign exchange market, resulting in a drop in the local currency.

India, the world's largest consumer of the yellow metal, celebrates a gold-buying festival on May 6 and will be followed by weddings expected to pump up demand.

India had imported 900 tonnes of gold last year spurred by wedding and festival purchases.