Fears of inflation pushed gold prices to a new high on Tuesday, suggesting a dampen-ed demand this festive season.
In Indian markets, the yellow metal crossed the Rs 16,000 per 10 gm mark, taking a cue from the world where it crossed $1,000 per ounce (31 gm).
Prices are higher in India due to local taxes. There are also inter-city variations due to retail and transport-related factors.
Gold reached Rs 16,200 per 10 gm in Delhi.
In Mumbai, gold was at Rs 15,950 per 10 gm.
India is the world’s largest consumer of gold with an annual demand of about 800 tonnes.
“The increased gold price will obviously hit consumption demand,” said Anand James, senior analyst with Geojit Comtrade Ltd. “As a result, there would be lesser import of gold.