Gold Prices Drop by Rs 4,000 in 48 Hours, Check New Prices
Gold prices continued to decline on Wednesday, dropping by Rs 650 to Rs 71,650 per 10 grams in the local market. This marks the second consecutive day of decline, attributed to weak demand from jewellers and the recent import duty cut announced in the budget for 2024-25.
According to the All India Sarafa Association, gold had closed at Rs 72,300 per 10 grams in the previous session on Tuesday, after a significant drop of Rs 3,350. In contrast, silver prices remained steady at Rs 87,500 per kg in the local market.
The decline in gold prices is largely due to the government’s decision to slash customs duties on gold and silver from 15% to 6%. This move has led to a significant drop in gold prices, with a total decline of Rs 4,000 per 10 grams in the past two sessions.
Gold of 99.9% and 99.5% purity also saw a decline of Rs 650 each, to Rs 71,650 per 10 grams and Rs 71,300 per 10 grams, respectively. Traders believe that the cut in import duties has led to a decrease in demand, resulting in lower prices.
Manav Modi, Senior Analyst at Motilal Oswal Financial Services Ltd, noted that the cut in import duties took the market by surprise, leading to a decline in domestic gold prices. However, Comex gold prices have seen an increase, widening the disparity with domestic prices.
In the international market, Comex gold was trading at USD 2,461.20 per ounce, up by USD 6 per ounce. This increase comes after a four-day losing streak, as the market awaits clarity on the US Federal Reserve’s interest rate cut.
Kaynat Chainwala, AVP-Commodity Research at Kotak Securities, noted that gold continues to hold gains above USD 2,410 per ounce, amid anticipation of upcoming US data releases that could support Fed rate cuts. The Flash PMI data release on Wednesday will be closely watched for insights into business activity in July.
Pranav Mer, Vice President at JM Financial Services, stated that gold prices are trading positively, tracking gains in the overseas market and buying support at corrective levels. Traders will now focus on the US GDP data due on Thursday and the Personal Consumption Expenditures (PCE) inflation data on Friday, for clues on the Fed’s rate cut path.
