Govt Slashes Gold, Silver Base Import Price; Gold Rate Today June 12 Rebounds Sharply; Impact on Buyers

The central government on Friday, June 12, cut the base import price of gold by $80 per 10 grams to $1,343, and slashed the silver base import price by $276 per kg to $2,092 per kg.

The revision was notified by the Central Board of Indirect Taxes and Customs (CBIC) and aligns India's customs duty calculation base with the ongoing correction in global bullion markets. The revision was announced a day after gold prices crashed sharply in domestic markets.
However Gold rates today have staged a strong rebound, with 24-carat gold price rising Rs. 294 per gram to Rs.14,858 per gram on June 12.

What Is the Base Import Price?

The base import price is also called the tariff value and it is the official price set by the government on which customs duty on imported gold and silver is calculated. It is revised roughly every fortnight by CBIC, and sometimes more frequently when global prices are volatile.
However it should be noted that this is not the price you see at jewellery stores. It does not directly set retail gold rates. Moreover, it does influence the cost of gold for importers and bullion dealers.

Gold Rate Today, June 12: Sharp Rebound After Yesterday's Crash

Gold prices in India bounced back strongly on June 12, reversing a large part of yesterday's losses. Here are today's gold rates per gram:

Quantity	24K Gold Rate Today	22K Gold Rate Today	18K Gold Rate Today
1 gram	Rs. 14,858 (+Rs. 294)	Rs. 13,620 (+Rs. 270)	Rs. 11,144 (+Rs. 221)
8 grams	Rs. 1,18,864 (+Rs. 2,352)	Rs. 1,08,960 (+Rs. 2,160)	Rs. 89,152 (+Rs. 1,768)
10 grams	Rs. 1,48,580 (+Rs. 2,940)	Rs. 1,36,200 (+Rs. 2,700)	Rs. 111,440 (+Rs. 2,210)
100 grams	Rs. 14,85,800 (+Rs. 29,400)	Rs. 13,62,000 (+Rs. 27,000)	Rs. 11,14,400 (+Rs. 22,100)

Despite today's rebound, gold rates are still well below the all-time high it touched earlier this year,so it is the right time for gold purchase for buyers who were waiting for corrections.

"Gold and silver prices remain under pressure despite hopes of renewed peace talks following the US strikes on Iran. While easing geopolitical tensions could reduce inflation concerns, disruptions to energy supplies through the Strait of Hormuz continue to pose risks. From a technical perspective, gold has breached the key $4,300 support level and may head towards $4,000, while silver has fallen below $66 and could test the $60 mark," said Prithviraj Kothari, Managing Director of RiddiSiddhi Bullions Ltd., President of IBJA, and Chairman of JITO.

Impact of the Import Price Cut for Buyers and the Market

No major changes for jewellry buyers since Retail gold prices are impacted by international spot prices, rupee-dollar exchange rate, GST and making charges not directly by the tariff value. But t if CBIC keeps cutting the base price over multiple revisions, it can gradually lower the landed cost for importers, which over time can move into slightly lower wholesale and retail prices.

Gold loan NBFCs lend against physical gold. A lower gold price environment reduces the loan-to-value on existing gold loans, creating margin pressure.

India imports nearly all of its gold requirements so a sustained drop in gold import prices narrows the Current Account Deficit and reduces pressure on the rupee, a positive signal for the economy.