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Gold Market Dynamics: Discounts Persist in India Amid Anticipation of Import Duty Changes

Gold Market Dynamics Discounts Persist in India Amid Anticipation of Import Duty Changes
Gold Market Dynamics Discounts Persist in India Amid Anticipation of Import Duty Changes

Physical gold dealers in India have been offering discounts for nine consecutive weeks due to elevated prices, driven by anticipation of a potential import duty reduction in the upcoming budget. India, the world’s second-largest gold consumer, has seen a slowdown in demand as rising prices have deterred buyers.

Prices were trading around 72,600 rupees per 10 grams, down from a record high of 74,442 rupees in May. Jewellers are cautious ahead of the budget, traditionally speculating on duty cuts, which has further subdued purchasing activity.

Gold Market Dynamics Discounts Persist in India Amid Anticipation of Import Duty Changes
Gold Market Dynamics Discounts Persist in India Amid Anticipation of Import Duty Changes

In China, another major gold consumer, demand has also shown weakness. Dealers there charged premiums of $11-$24 per ounce over international spot prices, slightly lower compared to the previous week. High gold prices have continued to weigh on retail and wholesale demand in the region, as noted by experts like Hugo Pascal from InProved.

Across Southeast Asia, Singapore reported gold being sold at par to $3 premiums, while Hong Kong saw sales at par to $2 premiums. In these markets, there has been increased interest in silver bars and coins, partially attributed to the relatively high prices of gold compared to silver.

In Japan, bullion prices ranged from par to premiums of $0.50, indicating stable but cautious market conditions. The global gold market remains influenced by economic factors such as import duties, local demand trends, and broader economic conditions in major consumer countries like India and China.

Michael Sebastian

Written by Michael Sebastian

Michael is a part time trainer at Kerela Sports Academy, he is a sports enthusiast as well as a big fan of basketball.

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