Gold price discounts in India jump to highest in 7 months
Premium- Gold rates in India include 10.75% import duty and 3% GST and discounts rose to $5.5 an ounce last week
Gold dealers in India offered highest discounts in nearly seven months after domestic prices surged to nearly one-year highs on Russia-Ukraine tensions. Dealers were offering a discount of up to $5.5 an ounce last week on official domestic prices, up from previous week's discount of $2.5, according to news agency Reuters. Gold rates in India include 10.75% import duty and 3% GST.
Gold rates in India last week had jumped to nearly highest levels in a year after they touched ₹50,500, tracking a rally in global rates.
Citing a dealer, the report said that jewellers remained cautious in making fresh purchases, anticipating a price drop once Russia-Ukraine tensions ease.
Today, gold futures slipped to ₹50,070 per 10 gram on MCX on news of a potential summit between US President Joe Biden and Russian counterpart Vladimir Putin.
According to While House, US President Joe Biden has accepted in principle a summit with Russia's Vladimir Putin over the Ukraine crisis but the Biden administration warned: “Currently, Russia appears to be continuing preparations for a full-scale assault on Ukraine very soon."
Axis Securities has a neutral stance on gold and recommends a ‘Buy-on-Dips’ strategy. The precious metal will continue to find support from the geopolitical risk and the inflation pressure in a global environment, the brokerage said.
Analysts say that that bullion in the short term will track developments related to Ukraine and comments from Fed officials. Two top Federal Reserve officials at the end of last week backed raising rates in March to curb the hottest inflation in 40 years. They also supported starting balance-sheet reduction in coming months.
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“Technically, we have a strong resistance around $1916 which was a high of May 2021 whereas strong support formation is around $1890 below which we may expect strong correction till $1865. Traders are advised not to hold short if yellow metal sustains above $1920 at any given time this week," said Vidit Garg, Director, MyGoldKart. (With Agency Inputs)
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