Author: Ishaan Arora and Rajendra Jadhav
Feb 6 (Reuters) – Gold premiums in India more than halved from a decade high this week as price volatility kept buyers away, while a pullback in record prices boosted Chinese demand ahead of the Lunar New Year.
The premium charged by bullion traders this week was $70 an ounce over the official domestic gold price, which includes a 6% import tax and a 3% sales tax, down from last week’s $153 premium and the highest level since December 2013.
“Buyers are confused by this week’s price fluctuations and unable to figure out the larger price trend,” said a Mumbai-based jeweler.
Expectations of a hike in import duties in the budget pushed up gold premiums last week but fell as demand fell, a trader at a gold import bank in Mumbai said.
India’s Finance Minister presented the 2026/27 Union Budget on February 1, with the responsibilities structure remaining unchanged.
Domestic gold prices were trading around Rs 150,000 per 10 grams on Friday after hitting a record high of Rs 180,779 last week, falling to a low of Rs 133,687 this week.
In China, gold bars traded at a premium of $35 an ounce to the global benchmark spot price this week, up from a $32 premium last week.
Peter Fung, head of precious metals trading at SinoPac, said: “So we can see that during the downturn, consumers are still interested in buying jewelry, and physical investment demand is also very good.”
Spot gold prices have fallen more than 13.5% since hitting an all-time high of $5,594.82 on January 29. [GOL/]
“The correction in gold and silver prices comes at a good time, just ahead of the Chinese New Year,” said ANZ analyst Soni Kumari.
China’s gold consumption fell for the second consecutive year in 2025, but sales of gold bars and coins exceeded purchases of gold jewelry for the first time, driven by growing demand for safe havens, the China Gold Association said.
In Hong Kong, gold trades at par and a premium of $1.70, while in Japan, gold bars sell for $7 and a premium of $1.
In Singapore, gold is sold at a discount of US$0.50 and a premium of up to US$3.
(Reporting by Ishaan Arora and Swati Verma in Bengaluru and Rajendra Jadhav in Mumbai; Editing by Rashmi Aich)
