Indian Physical Gold Buying Picking Up

Evidently, acclimatization to higher prices is beginning to take place. According to a Reuters report webbed by the Economic Times, buyers are stepping back in to the Indian market - in part because of a stronger rupee:

"Demand is good, I booked around 100 kgs from morning as the rupee is in supportive mode," said a dealer with a state-run bank in Mumbai....

"There are deals at $1,366 levels," said the dealer. Winter harvesting season is underway in India and is expected to leave more disposable income with rural households, which contribute significantly to gold demand. Marriage season has also started and will last through May.

$1,366 is well below where gold is now, so reluctance is still there. If gold stays above $1,380, there may be further bending by buyers.