Gold for August delivery rose $5.8 to $1,403 an ounce in electronic trade on the Comex division of the New York Mercantile Exchange.
Investors on Tuesday also reacted to a decision by India's central bank to extend gold import restrictions to designated agencies and trading houses in a bid to reduce the country's current account deficit.
Industry executives last week said they were expecting 100-120 tons of imports in May, same as the previous month. India imported 864 tons of gold in 2012, according to the World Gold Council.
Over the past year, the government has taken steps such as raising the import tax on gold to 6% from 2% to make local purchases costlier and bring down demand. The central bank has tightened lending regulations for gold imports.
But these measures haven't had much impact, as the May import number suggested. The World Gold Council, a mining-industry group, last week projected India's gold imports to rise 150% in the three months ending June 30 to 400 tons from 160 tons a year earlier.
World Gold Council (WGC), the premier organization that promotes the use of gold globally, has approached the Reserve Bank of India (RBI) to work with it so that yellow metal could be promoted as a financial asset, rather than just a physical asset.
MCX August gold futures are trading up nearly Rs 70 at Rs 27164 per 19 grams. The counter may find support near Rs 26900 levels today.
Later Wednesday, gold prices may be pushed up further or yanked lower following a report on private-sector jobs growth for May from Automatic Data Processing Inc. Investors read the ADP figures for any insight on what the U.S. government's monthly payroll report — due Friday — may say.
The ADP data is due at 8:15 a.m Eastern. Also on tap Wednesday is the Fed's Beige Book of anecdotes about the economy, and a report on U.S. factory orders in April, among other data.
Source by Commodity Insights
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