Gold slips again on renewed selling; silver extends losses

Mumbai: After a modest rebound over the weekend, gold prices dropped again at the domestic bullion market following fresh bouts of profit-taking as well as poor local buying support in the face of bearish overseas sentiment.

Silver, on the other hand, continued its uninterrupted downtrend amid sluggish industrial demand. Standard gold (99.5 purity) declined by Rs 80 to end at Rs 25,985 per 10 grams from last Saturday's closing level of Rs 26,065. Pure gold (99.9 purity) shed by Rs 85 to finish at Rs 26,130 per 10 grams compared to Rs 26,215 previously. Silver (.999 fineness) dropped by Rs 120 to conclude at Rs 36,850 per kg against the weekend level of Rs 36,970.

The US Fed's decision to end its year-long bullion- friendly bond buying programme has led to investors dumping gold and accumulating equities, a bullion trader said. Last week, the yellow metal lost over 4.58 per cent to hit a 15-month low, while silver slumped more than 6 per cent. Globally, the shiny metal remained under intense selling pressure, stretching its losing streak to a fourth session on the back of upbeat US macro data as well as stronger dollar which hit a four-year peak against major currencies, hurting bullion's appeal as a hedge.

Last week, both the precious metals sank to their lowest levels since 2010 following a massive sell-off unleashed by panic-stricken speculators and funds. Spot gold was bid lower at USD 1,172.26 an ounce during the European morning trade, while silver was bid at USD 16.09 an ounce.