Gold Up On Rupee; Premiums Steady

India gold edged higher on Monday morning following a weaker rupee, and premiums in the physical market steadied even as buying remained absent in the peak wedding season, dealers said.

The most-active gold for February delivery on the Multi Commodity Exchange was 0.15 per cent higher at 29,243 rupees per 10 grams.

Weakness in the rupee, which plays an important role in determining the landed cost the dollar-quoted yellow metal, makes the asset expensive.

The rupee drifted lower after the currency had climbed 2 per cent last week snapping a four-week slide.

Gold prices in the overseas markets traded steady, after posting their sharpest weekly rise in more than a month.

Traders said premiums charged on London prices remained flat at $1-1.25 per ounce on London prices. Weddings will continue till December in India, the world's biggest buyer of bullion.

"Buying is not really very encouraging," said a dealer with a private bullion importing bank in Mumbai, adding there has not been much change in premium since supply is steady."

(Reuters)