Why is gold rate in India different in each city?

gold rate india city

Gold rate in India differs across each city due to various local market factors like state taxes, demand and supply of gold in the local city market, gold transportation cost to the city market, security cost involved and the profit margin decided by the local jewellers association. Gold rate in city markets is changed twice a day and is been adjusted locally depending on the MCX and international gold rate changes to protect local jewellers and traders profit margin.

Gold rate decided by the local jewellers association is generally followed by the jewellers thought not always as it is not binding or a compulsion for them. Its been observed that in the case of a sudden drop in gold rate the benefits are not passed on to the customer immediately to protect their own (jewellers) profit margins but gold rates are increased immediately if the gold rate increases nationally or internationally.

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