India gold extended losses for a second day on Tuesday weighed by early strength in the rupee, triggering light buying in the physical market as traders braced for festivals, when demand for the yellow metal tends to go up, dealers said.
Gold on the Multi Commodity Exchange (MCX) was trading 0.20 percent lower at 19,063 rupees per 10 grams at 1:14 pm, down about 1 percent from the all-time high of 19,257 rupees struck on September 15. "There are buyers even at these levels as people are bullish on prices they expect prices to be at 20,000/20,500 rupees by Diwali," said Suresh Kumar, managing partner, Visakhapatnam-based Visakha Bullion, which caters to markets in Andhra Pradesh.
The Indian rupee rallied to its highest in more than four months early in the day, boosted by surging foreign buying of domestic stocks, but soon met with resistance as importers stepped in to cover their positions. A strong rupee makes the dollar-quoted asset cheaper for local holders.
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