Gold price crosses Rs.50,000 mark for the first time, dampens retail demand
Gold price reached an all-time high in India, crossing the Rs 50,000 mark for the first time. The precious yellow metal is being valued at Rs 50,085 ($671.61) per 10 grams. India is the world’s second-largest consumer, but the price rise has dampened its retail demand.
According to Reuters, in the spot market gold prices flipped into discounts owing to weak demand. It pointed out that dealers were offering a discount of up to $5 an ounce over official domestic prices, inclusive of 12.5% import tax and 3% sales tax, down from last week’s premium of $2.
Harshad Ajmera, the proprietor of JJ Gold House in Kolkata, said he couldn’t sell a gram of gold today. He said prices rose too much too quickly. “Buyers will wait for a few days to see whether they sustain at higher levels,” Ajmera said.
Globally, gold has an edge. Demand for the precious metal went up due to worries over a spike in COVID-19 cases and expectations of higher inflation from more stimulus measures to mitigate the economic blow.