Gold investors have something to cheer from the Budget. The Finance Minister Nirmala Sitharaman announced the slashing of the customs duty on gold and silver to 7.5 percent from 12.5 percent earlier. The Budget speech document mentioned that gold and silver will attract agriculture infrastructure and development cess at the rate of 2.5 per cent.
A cut in customs duty would result in a decrease in the prices of these precious metals. This reduction benefits investors who wish to invest in gold exchange-traded funds, as it brings down gold prices. The April month futures lost 3.01 percent and were trading around Rs 47,851 per 10 gram. Prices of gold ETFs also came down in the range of one to two percent. Sovereign gold bond prices also fell marginally.
Gold spot prices in the international market are quoting at around US dollar 1,869 per troy ounce. Indian gold prices are dependent on international gold prices, rupee dollar exchange rate and taxes such as customs duty.
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