New Delhi: Gold prices dropped by Rs650 to Rs71,650 per 10 grams in the local market here on Wednesday, continuing the retreat for the second day in a row due to weak demand from jewellers and import duty cut announced in the budget for 2024-25. According to the All India Sarafa Association, the precious metal had closed at Rs72,300 per 10 grams in the previous session on Tuesday after taking a hit of Rs3,350. Silver prices, however, remained flat at Rs87,500 per kg in the local market. Gold of 99.9 per cent and 99.5 per cent purity slumped by Rs650 each to Rs71,650 per 10 grams and Rs71,300 per 10 grams, respectively.

Traders attributed the decline in gold prices to the government’s move to slash customs duties on a range of products, including gold and silver. The customs duty on gold and silver was cut from 15 per cent to 6 per cent. In the past two sessions, gold prices have tanked by Rs4000 per 10 grams. “Gold and silver on domestic front languished in the previous session as the Finance Minister of India announced a cut in import duties taking the market by surprise. “On the other hand, move on prices on Comex rose, increasing the disparity of it with the domestic prices,” Manav Modi, Senior Analyst, Commodity Research at Motilal Oswal Financial Services Ltd, said.