Gold drops by Rs 215 on strong rupee, tepid global cues

New Delhi: Gold dropped Rs 215 to Rs 38,676 per 10 gram in the national capital on Wednesday on strong rupee, according to HDFC Securities.

In line with gold, silver prices also declined by Rs 770 to Rs 47,690 per kilogram. On Tuesday, silver had closed at Rs 48,460 per kilogram.

Gold prices had closed at Rs 38,891 per 10 gram in the bullion market here on Tuesday.

"Gold price for 24 Karat in Delhi was trading down by Rs 215 as stronger rupee reduced investment demand for gold. The spot rupee was trading 51 paise stronger against the dollar with fall in crude oil prices during the day," Tapan Patel, senior analyst - commodities, HDFC securities said.

In the international market, gold prices were trading marginally lower at USD 1,500 an ounce in New York, while silver was also trading down at USD 17.81 an ounce.

"Gold prices traded marginally lower on Wednesday with international spot gold prices trading near USD 1,500 an ounce ahead of US FOMC decision and eased crude oil supply worries," Patel said.

International gold prices were trading steady, holding the narrow trading range as market is awaiting outcome of US Federal Open Market Committee (FOMC) meeting and stance over Fed rate, he added.

Meanwhile, the Indian rupee appreciated by 35 paise to 71.43 against the US dollar in early trade on Wednesday as gains in domestic equity market and easing crude prices strengthened investor sentiments.