New Delhi: Physical gold dealers in India charged a premium over official domestic prices for the second week in a row as jewellers stocked up ahead of the festive season.
Domestic gold prices in India include 12.5% import duty and 3% GST. Dealers charged an $1 an ounce premium over official domestic prices, as compared to last week’s premium of $2, Reuters reported. Demand from dealers has been improving slowly while a sharp drop in September imports also allowed dealers to charge a premium, analysts say.
Gold imports declined by nearly 53% to $601.43 million in September. In the futures market, gold prices settled 0.3% lower at ₹50552 per 10 grams on Friday. For the week, gold settled marginally lower in tandem in with a decline in global rates.
Gold, which has risen about 25% so far this year, is considered a hedge against inflation and currency debasement amid the unprecedented global levels of stimulus. In India, gold rates had hit a record high of ₹56,200 on August 7.
Analysts say that gold is likely to remain supported on the downside amid increasing challenges to the global economy. ETF inflows show buying interest in gold however the pace has been also modest.
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