The yellow metal rose to trade at Rs.58,826 on the Multi Commodity Exchange.
Gold prices today extended gains on Thursday to touch fresh record highs after the US Federal Reserve raised interest rates by an expected 25 basis points and Chair Jerome Powell's comments were read as dovish by the market. The yellow metal rose to trade at Rs.58,826 on the Multi Commodity Exchange (MCX).
“US Fed has raised interest rates by 25 bps in yesterday's FOMC meeting that signals its soft stance on rate hike. This has led to US dollar rates nosediving to 9-month low and this is also a reason for gold price rally in domestic and international market," said Anuj Gupta, Vice President — Research at IIFL Securities.
In the international market, spot gold surged to $1,951.79 per ounce, after hitting its highest since April 2022 earlier in the session. The Fed delivered a quarter-percentage-point rate increase on Wednesday after a year of larger hikes. However, Powell warned of further monetary policy tightening while noting the progress on disinflation, which he said was in its early stages. Gold tends to benefit in a lower interest rate environment, as it reduces the opportunity cost of holding non-yielding bullion.
On the reason for rise in gold and silver prices on MCX, market expert Sugandha Sachdeva said," Budget 2023 has proposed to increase duty on silver dore, bars, and articles to bring it at par with gold and platinum dore and bars. Import duty on silver has been raised from 7.5% to 10%, along with 5% agriculture and infrastructure cess, implying a net duty of 15%. The social welfare surcharge has however been removed. Besides, duty on silver dore has been increased from 6% to 10%, implying a total duty of 14.35%. Overall precious metal imported jewellery and articles (gold/silver/platinum) now attract an import duty of 25% as against 20% previously. Separately, capital gains tax has been exempted for conversion of physical gold in to EGR, a further step towards boosting financialisation of gold."
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