Gold Today Rate, February 20: 24K prices dip to ₹15,617 per gram

India’s domestic gold market continued its retreat Friday, as the yellow metal struggles to find a floor following the historic volatility of early February. The price for 24-karat gold stood at ₹15,617 per gram, a decline of ₹32 from the previous session. 22-karat gold, preferred for jewellery, fell to ₹14,315 per gram.

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This downturn marks a cooling period after January 2026, when prices surged nearly 20% to reach all-time highs. The correction was primarily triggered by the Union Budget’s sweeping changes to import duties and tax structures for precious metals.

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The “Sitharaman Correction”: Budget 2026 Impact

The pivotal moment for the bullion market was February 1, 2026. Finance Minister Nirmala Sitharaman slashed the basic customs duty on gold and silver to 5%. This move was specifically designed to curb large-scale smuggling and enhance the international competitiveness of Indian jewellery exports.

However, the immediate result for domestic holders was a spectacular “crash.” Within 24 hours of the announcement, 24K gold fell by nearly ₹4,000 per 10g. While global prices remain anchored by Middle East tensions and US Federal Reserve uncertainty, India’s local “import parity” has now reset significantly lower.

City-Wise Breakdown: Chennai Leads Premiums

While national benchmarks moved lower, regional variations remain sharp due to local taxes and demand. Chennai remains the most expensive major market, with 24K gold trading at a premium of ₹15,731 per gram.

SGB Taxation: A New Hurdle for Investors

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Beyond the duty cut, the Budget introduced a restrictive “Tax Shield” for Sovereign Gold Bonds (SGB). Capital gains tax exemptions are now limited strictly to individuals who subscribe during the initial issuance and hold until maturity. Therefore, bonds bought from the secondary market (Stock Exchanges) no longer carry the tax-free advantage, potentially cooling the demand for digital “paper” gold.

Reality Check

The government claims the duty cut supports consumers. Still, the 12% drop in 10 days has wiped out billions in household wealth for those who bought at the January peak. Therefore, while gold is a “safe haven,” the sudden policy shift has made it one of the most volatile assets of 2026. In fact, despite the local dip, gold is still testing the $5,000 per ounce mark internationally due to safe-haven demand from US–Iran tensions. Thus, the domestic “discount” may be short-lived if global triggers remain explosive.

The Loopholes

Speculation of a duty hike prior to the Budget caused massive front-running. In fact, many jewellers hoarded stock in late January, only to be hit by the surprise cut. Therefore, the current “lower rates” at retail shops might not immediately reflect the full 5% duty drop as jewellers look to recover their losses on old, high-cost inventory. Still, the Aadhaar-based e-sign required for new digital gold purchases creates a “transparency loophole” that forces previously unrecorded wealth into the formal tax net.

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What This Means for You

If you are planning to buy jewellery for the upcoming wedding season, the current correction is a strategic window. First, realize that prices are still 40% higher than the 2025 average; do not expect a return to “pre-rally” levels. Then, track the US Dollar index; a stronger dollar makes gold more expensive in Rupee terms, which could offset any further duty relief.

Finally, understand that SGBs are now strictly for “long-haulers.” You should avoid buying them on the secondary market if tax-free gains were your primary goal. Before purchasing physical gold, verify the BIS Hallmark and request an official invoice that explicitly breaks down the revised 5% GST/Duty components.

What’s Next

The MCX Gold futures (April 2026) are currently finding technical support near ₹1,54,400 per 10g. Then, the release of US inflation data later today could trigger a fresh global rally if it supports early rate cuts. Finally, look for a surge in retail demand starting next week as consumers rush to take advantage of the post-Budget price “reset.”

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