Prices of gold and silver dipped by nine per cent each on Multi Commodity Exchange (MCX) on Sunday, just before Finance Minister Nirmala Sitharaman is scheduled to present the Union Budget for the financial year 2026-27. The precious metals have faced one of the highest two-day sell-offs in history, NDTV reported.
Budget day speculation on possible import duty changes has come just as prices slid, leaving traders unsure. Many are now watching for cues on whether this fall turns into a buying chance or a deeper hit to India's jewellery trade.
How much did gold-silver prices slide?
Gold on MCX dropped sharply, falling by Rs. 13,711 to Rs 1,38,634 per 10 grams. Silver also slid hard, down Rs. 26,273 to Rs 2,65,652 per kg. The fall was steeper than the six per cent crash seen in early trade, NDTV reported.
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On Friday, silver prices decreased by 37 per cent intraday. Meanwhile, gold prices fell by 13 per cent globally. While the crash in silver prices was the biggest ever, the decrease in the prices of gold is the largest since the early 1980s, NDTV reported.
Speculations on custom duty
At present, gold and silver bars attract about six per cent basic customs duty and three per cent GST. This takes the total tax burden to nearly nine per cent. The rate is much lower than in earlier years, when duties were close to fifteen per cent and had led to widespread smuggling.
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Speculations are rife on whether the Finance Minister will decrease the duty from 6 per cent to 4 per cent, which would lead to the dipping of gold prices by two to three thousand rupees per ten grams. This could also lead to the further dipping of silver prices by about six thousand rupees per kilogram if the global trends continue, NDTV reported.
The policy dilemma is still unsettled. Cutting duties would make gold cheaper and help households and exporters. Raising them would support the rupee and protect the current account from a jump in gold imports.
