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Current Gold Rate in Mumbai & Today Gold Market in 2024

Gold is one of the most-coveted precious metals in the financial capital of India, Mumbai. Besides its popularity as an ornament of choice for various Indian occasions, gold is also preferred among Mumbaikars as an investment option, owing to its highly liquefiable nature and stability in the face of inflation and market fluctuations. The gold rate today in Mumbai is within the vicinity of INR 60,000, gradually increasing as stock markets face the ripples of global volatility.

Current Scenario of Gold Investments in Mumbai

In a recent report, Axis My India highlighted that gold is the most trusted investment choice in tier-1 cities like Mumbai. It found that almost 36% of the tier-1 population purchased gold as an investment over adornment. This sentiment has only grown stronger in Mumbai over the past year, as markets have remained volatile and inflation peaks.

Today Gold Rate in Mumbai

The following table presents rates of pure (24k) and standard (22k) gold over the past 10 days.

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DatePure (24k) 1 gmPure (24k) 10 gmPure (22k) 1 gmPure (22k) 10 gmChange in percentage

Factors Affecting Gold Rate Today in Mumbai

If you plan to invest in gold to secure your corpus, it’s imperative to consider a few critical factors that sway gold prices in Mumbai to maximise the potential of appreciation.

  1. Inflation

    One of the foremost factors that affect gold rates in Mumbai is inflation, which is the general rise in the prices of commodities in an economy.
    During inflation, the rupee’s value declines in relation to purchasing power. Hence, people tend to invest in gold to secure their finances against the falling rupee value, as in the long run, gold’s value remains relatively stable. An increased demand results in a higher gold price in Mumbai.
  2. Global Trends

    India is one of the largest importers of the yellow metal globally. Hence, the gold spot price, which is the rate at which transactions occur internationally, significantly determines the gold rate in India vis-à-vis Mumbai. When investing in gold, it’s prudent to check the pulse of global trends, which include but are not limited to political and economic instability in key exporting economies, disruptive forces playing out in the supply chain, as well as tensions between key economies.  
  3. National Economic Policies

    Government policies such as the central bank interest rate have a crucial bearing on the current gold rate in Mumbai. Usually, during an inflationary spell, the RBI increases interest rates to curtail the cash flow in the economy. This hampers people’s purchasing power, which results in a decline in demand for gold.

    Further, investors prefer fixed-income instruments over gold when interest rates are hiked. Conversely, when the RBI reduces interest rates, demand for gold increases, owing to the promise of higher returns.
  4. Quality of Gold

    Gold quality is another factor that determines prices. Gold articles are priced based on their purity grade, i.e., 14k, 18k, 20k, 22k, 23k, and 24k. The purest form is 24k gold, which is 99.5% pure. Hence, the 24-carat gold rate today is higher than the 22-carat gold rate.
  5. Demand and Supply

    The trading rate of any commodity is based on its demand and supply. Gold’s demand depends on various factors, both economic and social. For instance, during wedding seasons, gold prices surge due to increased demand. Further, a good rainy season also increases demand as farmers vis-à-vis rural India are the largest consumer groups of gold in India.

    Conversely, limited supply can also lead to a hike in the gold rate today in Mumbai. Gold reserves are primarily maintained by the RBI in India; hence, if the RBI chooses to buy more gold than it sells, it can lead to price hikes and vice versa.
  6. Indian Rupee Value

    As gold is predominantly imported into India, INR’s exchange value significantly impacts the pricing. If INR’s rate declines against the British Pound Sterling, US dollar, and Euro, the price of gold will be higher, and vice versa.

Taxes on Gold in Mumbai

Various taxes apply to gold, depending on the medium of buying, whether you’re importing it, and whether you are buying or selling it. These taxes have been discussed below.

1. On Purchase

Taxes in Mumbai when buying gold is the same as in the rest of India. Such taxes on gold rate today in Mumbai primarily constitute of three charges:

  • Customs duty, which has been reduced from 12.5% to 10% presently. 
  • Goods and Services Tax, which is 3%.
  • Agriculture Infrastructure Development Cess, which is 5% and added over and above import duty and GST on gold imports

2. On Sale

When selling gold, it can attract either of the two types of taxes: short-term capital gains (STCG) tax and long-term capital gains (LTCG) tax.

  • STCG tax applies when you sell gold within three years of buying. You need to add the realised amount to your annual tax liability in that case.
  • LTCG tax applies when you sell after three years of purchase. A 20% tax with an indexation benefit is imposed on the realised sum.

Alternatives to Physical Gold in Mumbai

Gold as an investment can be held in many forms, the physical being one of the most popular. However, there are several limitations to physical gold, such as making charges, the cost of storage, and the hassle of liquidation. To overcome these limitations, one can consider the following alternatives: 

1. Sovereign Gold Bonds

These are government-issued bonds denominated against the 1-gram gold price in Mumbai vis-à-vis India. SGBs involve a maturity period of 8 years and a lock-in period of 5 years. You can alternatively trade it on the stock market at any time.

2. Gold Savings Funds

These are gold mutual funds that primarily (90 – 100%) invest in gold exchange-traded funds. Any remaining corpus is invested in the money market or short-term debt instruments.

3. Gold ETFs

Gold Exchange-Traded Funds are passive funds that aim to track the price of gold and invest in (and are backed by) 24k gold. They can be traded on stock exchanges, ensuring flexibility. Hence, you also need a Demat account to invest in gold ETFs.

4. Digital Gold

Digital gold offers the same utility as physical gold when it comes to investment and is also priced as per the current 24k gold rate in Mumbai. The only difference between digital gold and physical gold is that when you buy digital gold online, you don’t have to take up the hassle of storing it. The seller stores it on your behalf in a highly safe vault.

Alternatives to Gold Investment

Gold is a stable option among various other investment instruments. However, this factor also reduces gold’s capital-appreciation potential. So, if you are looking for more dynamic growth or an alternative to gold for interest earnings, the following options fare better:

  1. Stocks
  2. Equity-backed mutual funds
  3. Government bonds/debentures
  4. Debt mutual funds
  5. ETFs

Conclusion

Gold is a time-tested investment option for hedging against inflation and tiding over economic uncertainties. However, various factors besides the prevalent gold rate in Mumbai today need to be considered before you take the dive. This may include international factors, INR’s value, and so on. Further, consider your investment objective and horizon before investing, as gold offers stable returns over longer timeframes.

FAQs

Is the gold price in Mumbai rising?

Yes, gold price in Mumbai has been trending upwards, with spells of ups and downs, over the past year.

How to know if I am buying authentic gold in Mumbai?

Check the BIS hallmark and the purity grade on the article of gold you buy. Also, verify the 6-digit alphanumeric code on the BIS website.

How is the gold rate in Mumbai decided?

The gold spot price is decided in the London bullion market. Thereafter, taxes, INR’s value, demand and supply influence the gold rate in India vis-à-vis Mumbai. 

Disclaimer

This article is solely for educational purposes. Stable Money doesn't take any responsibility for the information or claims made in the blog.

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