MUMBAI: Indian gold extended losses yesterday to hit their lowest level in three weeks, but a weaker rupee limited the downside in prices, keeping away physical importers amid tight supplies.
The most-active gold for August delivery on the Multi Commodity Exchange (MCX) was 0.29 percent lower at Rs. 26,790 per 10 grams. It earlier hit a low of Rs. 26,727, a level last seen on May 30.
Gold imports into India, the world's biggest buyer of the metal, fell from an average of $ 135 million per day in the first half of May to $ 36 million in the second half, Finance Minister P. Chidambaram said last week.
India has ruled out a blanket ban on gold imports or any increase in customs duty from the current 8 percent.
Meanwhile, Chidambaram said yesterday there is no need to react and panic over the rupee's fall.
The rupee had slumped to a record low of 59.9850 to the dollar on Thursday, following the US Federal Reserve's statement on its plan to wind down the monetary stimulus.
"We are not insulated from what is happening in the rest of the world," Chidambaram said at a press conference. "My request is we should not react and panic. It is happening around the world."
Chidambaram said policymakers were monitoring the rupee and the Reserve Bank of India would do whatever was needed to stem the fall.
Indian gold prices fall to 3-week low
