Volatile moves seen in Gold ahead of near month expiry
Gold eased further as the latest corrective moves turned into a sustained downward slide. Traders are worried about the retail demand getting hit in cash squeezed Indian retail markets. First few days of a new month normally see labor payments and a lot of cash is circulated in the economy as people pay up for their monthly grocery bills and other maintenance expenses.
The country is still facing a heavy cash crunch Gold demand is unlikely to pick up in such a scenario. COMEX Gold is currently quoting off at its 10 month low. Prices are hovering at $ 1,176 per ounce, up 0.6 percent on the day.
MCX Gold futures for February 2017 took a heavy tumbled and closed under the key Rs 28,000 per 10 grams mark. The overall scenario is volatile as the near month December futures are set to expire on Monday. The US nonfarm payrolls data would also be keenly watched.
Meanwhile, latest amendments to the I-T law in India do not seek to tax inherited gold and jewellery as also those items that are purchased through disclosed or agriculture income, the government said on Thursday. The Lok Sabha earlier this week passed the Taxation Laws (Second Amendment) Bill, which proposes a steep up to 85 percent tax and penalty on undisclosed wealth that is discovered by tax authorities during search and seizure.
The Central Board of Direct Taxes (CBDT) clarified that the government has not introduced any new provision regarding chargeability of tax on jewellery.The jewellery/gold purchased out of disclosed income or out of exempted income like agricultural income or out of reasonable household savings or legally inherited which has been acquired out of explained sources is neither chargeable to tax under the existing provisions nor under the proposed amended provisions.
During search operations, conducted by I-T Department, there would be no seizure of gold jewellery and ornaments to the extent of 500 grams per married women, 250 gm per unmarried women as also 100 gm per male member of the family.
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