Gold, silver prices surge up to 8% after import duty hike

Gold and silver prices on Wednesday witnessed a sharp surge of up to 8% after the government more than doubled the import duty on precious metals. 

On the Multi Commodity Exchange (MCX), gold futures (June 5) advanced as much as 7.20% or ₹11,055 to touch an intraday high of ₹1,64,497 per 10 grams as of 9.50 am.

The yellow metal was trading at ₹1,62,728, up 6% or ₹9,286 from the previous close. Earlier in the session, it had opened at ₹1,54,851, rising 0.91% or ₹1,409, which also remained the intraday low so far.

Meanwhile, silver futures (July 3) also recorded strong gains during the session, jumping as much as 8% or ₹22,367 to hit an intraday high of ₹3,01,429 per kg.

The white metal was trading at ₹2,97,655, up 6.66% or ₹18,593 from the previous close. It had opened at ₹2,90,224, rising 4% or Rs 11,162 over the previous settlement price.

The rally in precious metals came after the Centre’s decision to increase customs duties on imports.

The government has raised the import duty, including cess, on gold and silver from 6% to 15%.

Meanwhile, import duty on platinum has been increased from 6.4% to 15.4%.

Through this move, the government aims to reduce the current account deficit and conserve foreign exchange reserves amid ongoing global uncertainty.

According to government sources, the increase in import duty on precious metals is part of a broader strategy aimed at conserving foreign exchange, safeguarding the current account, prioritising essential imports, and strengthening India’s economic resilience amid global uncertainties.

In the international market, COMEX gold rose 0.52% to $4,710 per ounce, while COMEX silver gained 2.28% to trade at $87.54 per ounce.