Mumbai: Gold prices in India, the world's second biggest consumer, jumped 1.4 percent on Monday after Finance Minister Arun Jaitley surprised the market by maintaining the import duty at a record level in the budget.
The market was expecting a reduction of up to four percentage points in import duty from 10 percent.
Many consumers had been delaying purchases for over a month hoping for a reduction in the duty, forcing importers to offer a record discount of up to $53 per ounce over global prices to clear inventory.
At 12:55 pm, the most active gold futures were trading 0.97 percent higher at 29,621 rupees per 10 grams, after rising to 29,750 rupees earlier in the day.
Shares of major jewellers such as Gitanjali Gems (GTGM.NS) were down 2 percent, while Titan Company (TITN.NS) fell 5 percent.