Spot gold prices up, but weak demand leads to high discount rates
This story was originally published at 14:11 IST on 2 July 2026
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By Abhijit Doshi
MUMBAI – The all-India average spot price of gold opened higher Thursday amid declining prices on the Multi Commodity Exchange of India and COMEX. Gold of 99.9% purity opened at INR 143,340 per 10 grams, up from Wednesday's close of INR 141,632 per 10 grams.
In Mumbai, spot gold opened at INR 144,500 per 10 grams. Dealers are offering a discount of around INR 3,000 per 10 grams, sources said.
Spot rates have risen in recent days after the government in May raised the import duty on gold to 15% from 6% to discourage import of the precious metal, reducing the outflow of foreign exchange. Gold prices have also gone up because of strength in the dollar.
While this has raised the cost of gold, demand has gone down, as reflected in the high discount being offered, sources said. At high discounts, some amount of bargain buying may not be ruled out, sources said.
Kelvin Warsh, who recently took over as the chair of the US Federal Reserve, signalled on Wednesday that the central bank would firmly follow its 2% inflation target and disappoint anyone who expected loose monetary policy.
But he largely declined to comment on the central bank's plans for interest rates, noting that the outlook for higher inflation had somewhat improved since he took office.
His comments spurred some overnight gains in the dollar, but his remark that inflation had somewhat improved weakened the dollar later as market suspected that Fed might not raise interest rates this year.
The market is now awaiting US non-farm payrolls data, to be released later in the day. End
US$1 = INR 95.27
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Avishek Dutta
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