India lowers base import price of gold. Check prices one week before Diwali

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Gold prices in India rose today in tandem with firm global rates. On MCX, gold futures rose 0.4% to 50,466 for 10 grams while silver futures jumped 1% to reach 55,816 per kg. On Friday, the Indian government slashed import prices of some commodities, including gold, as prices corrected on the world market. The government reviews the basic import prices of edible oils, gold and silver every fortnight, and the prices are used to calculate the amount of tax an importer must pay.

India is the world’s largest importer of edible oils and silver and the second largest consumer of gold. Gold rates in India included 15% import duty and 3% GST.

The purchase of physical gold is expected to increase in India ahead of the Dhanteras and Diwali festivals. The government reduced the base import price of gold to $531 per 10 grams from $533 previously.

In international markets, gold rates rebounded today from hitting two-month lows as the rally in the dollar stalled. Spot gold rose 0.4% to $1,648.91 an ounce after falling nearly 3% last week. But firm US bond yields capped the precious metal’s gains. The dollar index remained stable after hitting a 14-year high last week. The US dollar and yields have been key gold in recent months. Gold is very sensitive to rising US rates, which increases the opportunity cost of holding non-performing gold.

Spot silver rose 0.7% to $18.39 an ounce, platinum rose 0.3% to $901.67 and palladium gained 1.7% to $2,022.60 .

“Gold and silver saw strong selling last week on the back of bearish US economic data and strong gains in the dollar index and US bond yields. It was the worst week for gold in the world. the past two months, and for silver the worst week for the first time since September 2021. The price of gold fell below $1650 per troy ounce last week while silver fell below $18.50 per troy ounce,” said Rahul Kalantri, vice president of commodities, Mehta Equities Ltd.

“Gold has support at $1640-1628, while resistance is at $1662-1674. Silver has support at $18.10-17.80, while resistance is at 18.72- $18.95 In rupee terms, gold has support at 50,020-49,780, while resistance is at 50,410, 51,580. Silver has support at Rs54,750-54,240, while resistance is at 55,880 to 56,450,” he added.

Despite the precious metal’s recent price correction, holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell 3.18 tonnes on Friday, their largest one-day outflow since the September 26.

In India, gold prices fell by around 1,500 from this month’s high of 52,000 for 10 grams. (With contributions from the agency)

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