Gold price recovers on jewellers' buying; settles at Rs 29,450 per 10 grams

New Delhi: In an otherwise restricted activity, gold prices recovered by Rs 50 to Rs 29,450 per 10 grams at the bullion market Tuesday on scattered buying by jewellers and retailers even as the yellow metal weakened overseas.

However, silver remained under selling pressure and dipped below the Rs 41,000-mark by tumbling Rs 865 to Rs 40,735 per kg due to reduced offtake by industrial units and coin makers.

Traders attributed a mild recovery in gold prices to some buying by jewellers and retailers to meet ongoing wedding season demand but weak trend overseas capped the rise.

Bullion traders said the volume of business has dropped sharply by 75 percent in view of prevailing cash crunch in the market following the government banning 500 and 1,000 rupee notes on November 8 to flush out black money.

Globally, gold fell 0.54 percent to USD 1,187.30 an ounce and silver by 0.15 percent to USD 16.54 an ounce in Singapore.

In the national capital, gold of 99.9 and 99.5 percent purity rose by Rs 50 each to Rs 29,450 and Rs 29,300 per ten grams, respectively.

The bullion market reopened yesterday after 16 days, with gold prices dropping by Rs 1,750 per 10 grams. Market was closed after the Income Tax Department carried out surveys following reports of alleged profiteering and efforts at tax evasion in the wake of government's demonetisation move.

Sovereign, however, held steady at Rs 24,400 per piece of eight gram.

On the other hand, silver ready dropped further by Rs 865 to Rs 40,735 per kg and weekly-based delivery by Rs 940 to Rs 40,235 per kg.

Silver coins, however, held steady at Rs 74,000 for buying and Rs 75,000 for selling of 100 pieces.