Gold prices in the country zoomed to record levels today weighed down by weak stock markets and a flat interim budget that offered little help to the struggling industry.
Buyers were forced to postpone purchases even as they grappled with record prices above Rs15,000 per 10 gm. In fact, there were more sellers of scrap gold than buyers for jewellery, traders said.
The benchmark April contract for gold rose 2.9 per cent and hit an all-time high at Rs15,131 per 10 gm on the Multi Commodity Exchange of India Ltd (MCX). The contract was still above Rs15,000 at around Rs15,107 per 10 gm in afternoon trading.
Gold gained almost 3 per cent in the last week alone and by around 30 per cent over the pat three months.
Analysts expect gold to hit Rs16,000 per 10 gm soon as investors across markets turn to the safe-haven asset.
On the stock market, the benchmark BSE Sensex extended losses to 3 per cent on Tuesday afternoon after investors stopped buying in an uncertain market.
Gold gained in the overseas markets as well as funds continued to pour huge amounts into buying the precious metal. Gold in the SPDR Gold Trust, the largest exchange-traded fund backed by bullion, climbed to a record 985.86 tonnes as of 13 February, gaining 14 per cent over the last one week alone.
Spot gold advanced 1.8 per cent to $959.05 an ounce, the highest level since 22 July. Gold for April delivery in New York advanced to $961.10 an ounce, the highest level for the most active contract since July.
Gold imports to the country have come to a trickle after prices shot up to Rs13,500 per 10 gm locally and the the $900-mark internationally.
India, the world's biggest consumer and importer of gold, more than halved its imports this year to 250 tonnes from an average 720 tonnes a year in 2008.