The prices of gold and silver in India jumped sharply on Wednesday after the Union government increased import duties on the precious metals, making them more expensive in the domestic market.
Gold futures on the Multi Commodity Exchange had risen by nearly 6% to Rs 1.62 lakh per 10 grams as of 10.55 am. Silver futures had jumped by more than 6% to Rs 2.96 lakh per kg.
The sharp increase came after the government on Tuesday increased import duties on gold and silver to 15% from 6%.
The decision aims to reduce imports of the precious metals in India, the world’s second-largest consumer of gold and silver, and ease pressure on the country’s dwindling foreign exchange reserves. It may also help reduce the country’s trade deficit and support the weakening Indian rupee.
Rupee at record low
The Indian currency closed at a record low of 95.7 against the United States dollar on Wednesday. According to reports, the rupee had touched its lowest-ever intraday level of 95.8 against the US dollar, weakening for the fourth consecutive session
The rupee had slumped to 95.6 per dollar on Tuesday amid elevated global oil prices and economic headwinds caused by the conflict in West Asia.
Concerns have been mounting about the economic impact of the war amid an elusive peace deal between the United States and Iran.
The price of benchmark Brent crude was 106 per barrel on Tuesday. The price of Brent was $78 per barrel on February 27, a day before the conflict started.
Stock markets today
The Indian stock market rose marginally on Wednesday. The benchmark Sensex increased by 0.07% to 74,608.9 at closing, while the NSE Nifty50 rose by 0.14% to 23,412.6.
On Tuesday, the Indian stock market tanked for the fourth consecutive trading session, with investors losing more than Rs 11 lakh crore during the day.
The stock market had recovered marginally in April after a steep fall in March.
The India VIX index, which measures volatility in the market, increased 2.1% on Wednesday.
Major Asian stock indices had a mixed session on Tuesday. Hong Kong’s Hang Seng index was up 0.06%, South Korea’s Kospi 2.2%, China’s Shanghai Composite 0.3% and Japan’s Nikkei 0.8%.
Edited by Nachiket Deuskar
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