New Delhi: Taking into account weak global trends in the past few days, the government slashed the tariff value of gold to USD 449 per ten gram even as prices rebounded Thursday by Rs 250 on renewed buying at existing low levels.
After crashing by Rs 3,250 in the last four days, gold prices recovered to Rs 26,600 in Delhi market on fresh buying by stockists and retailers. Price of the precious metal rose by Rs 290 to Rs 25,920 in Mumbai and by Rs 150 to Rs 26,085 in Chennai. However, gold fell by Rs 10 to Rs 26,700 in Kolkata.
Government earlier on Thursday slashed the tariff value of gold to USD 449 per ten grams from USD 499 per ten grams.
It was only two days back that the tariff value, the base price on which the customs duty is determined to prevent under invoicing, was brought down to USD 499 per ten grams.
Meanwhile, jewellers like Gitanjali and P C Jewellers said people are buying more and sales have surged by up to 3 times as investors are trying to take advantage of 24 percent fall in price from its Rs 32,975 peak in November 2012.
"Sales are strong. In last one week, sales in volume terms have risen by 35 percent and value terms by 25 percent. We expect prices to stablise at Rs 26000-27000 per ten grams," Gitanjali Group Chairman and Managing Director Mehul Choksi said.
Expressing same views, PC Jewellers Managing Director Balram Garg said: "Prices have increased slightly today but people are buying as they feel prices would again rise."
"Our sales have jumped by 3-4 times than the normal sales around this time. Cumulative sales from our 32 showrooms has increased to Rs 25-30 crore per day as against Rs 8-10 crore prior to the fall in prices," he said.
Gold in overseas markets, which normally set price trend on the domestic front, rose 0.4 percent to USD 1,381.55 an ounce in Singapore. Prices touched USD 1,321.95 on April 16, lowest since January 2011.
According to the Bombay Bullion Association, sluggish global price trend will spur India's gold import by 20 percent to 183 tonnes in the first quarter of this fiscal.
In contrast to gold, silver remained weak for the fifth day by losing Rs 300 to Rs 45,400 per kg on lack of buying support from industrial units and coin makers.