Gold prices in Indian markets edged lower after rising to record highs on Monday. On MCX, October gold futures were down 0.41% or ₹154 to ₹37,191 per 10 gram. On Monday, gold futures rose to a record high of ₹37,437, tracking firm global rates and weakness in rupee. Silver prices also softened today. Silver futures on MCX were down 0.50% or ₹210 to ₹42,273 per kg. Silver futures had surged to a multi-year high of ₹42,647 on Monday.

Jewellers have, however, reported softening demand amid rising gold prices, which are up over 15% so far this year. They have also reported higher supply of scrap gold as many people sell their old ornaments, prompted by record high prices. Domestic gold prices include a 12.5% import tax and 3% GST. In global markets, gold prices added to gains after rising to a six-year high on Monday. Gold added 0.2% to $1,467.07 an ounce.

Escalating the trade war between the world’s two largest economies, the US slapped a currency-manipulator tag on China. Worsening US-China trade conflict prompted investors to dump riskier assets for safe-haven assets like gold and Treasuries. On Monday, China let its yuan weaken below the seven-per-dollar level, an 11-year low, while the offshore yuan fell to its weakest since international trading of the Chinese currency began.

Meanwhile, Reuters reported that gold imports in India for July plunged 55% from a year ago to the lowest level in three years as domestic prices jumped to a record high. Reuters also reported that gold dealers were offering a discount of up to $36 an ounce over official domestic prices, the highest in three years. The rupee had registered its biggest one-day fall in six years on Monday, further boosting the domestic prices. The World Gold Council has forecast consumption of gold in India to soften in the September quarter as record high local prices curtails buying.