Gold ‌discounts in India jumped to a record this week ​as a sharp import duty hike slowed demand ⁠and triggered investor selling, while investment demand kept Chinese premiums firm.

Dealers in India quoted discounts of up to $207 an ounce over official domestic prices ‌this week, inclusive of 15 per cent import and 3 per cent sales levies, up from the previous week's discounts of up to $15 ‌an ounce and premiums of $6.

The sudden price rise prompted ‌investors ⁠to sell, while jewellers and retail buyers stayed on ⁠the sidelines, said a jeweller based in Hyderabad.

Earlier this week, India raised import tariffs on gold and silver to 15 per cent from 6 per cent. The world's second-largest consumer ​of gold also tightened rules for ‌duty-free gold imports for jewellery exports by capping imports at 100 kilograms per licence.

Domestic gold prices in India were trading around ₹1,60,500 per 10 grams on Friday, after rising to ‌₹1,64,497 earlier this week, the highest in more than ​two months.

Gold discounts jumped to unusually high levels as demand virtually disappeared and scrap supplies increased, said ⁠a Mumbai-based bullion dealer.

"Firmer demand from China will likely counter India's weaker demand after the latter's policy changes," ANZ said in a ‌note.

In top consumer China, bullion traded at premiums of $15 to $20 an ounce over the global benchmark price, largely in line with last week's premiums of $14 to $20.

Premiums remained steady this week, supported by resilient investment demand and aggressive industrial buying, said Bernard Sin, regional director of Greater China at MKS PAMP.

"Import restrictions remain ‌a key constraint, though loosening is widely anticipated soon. Industrial stockpiling by solar and ​electronics firms is particularly aggressive, amplified by the removal of VAT (value-added tax) export rebates," he said.

Spot gold prices ⁠have declined 2.8 per cent so far in the week, as higher energy prices ⁠fuelled inflation concerns and reinforced expectations of prolonged higher interest rates.

In Hong Kong, gold traded at par to ‌premiums of $2, while in Japan, gold was sold at a discount of $0.50. In Singapore, gold was sold at premiums of $1 to $3.30.

($1 = 95.94 ​Indian rupees)

Published on May 15, 2026