Gold was sold by physical dealers on discounted price for a fourth straight week amid weak demand even though there has been a sharp decline in the yellow metal’s rates since last month’s highs.

Demand for gold in the country has been hit by the coronavirus pandemic and high prices. It has also been affected by the beginning of the ‘Shradh’ period, considered inauspicious for buying assets.

Gold demand usually sees an uptick ahead of the October-November festival season but dealers have said that a worsening coronavirus pandemic and the weak economy has dented sentiment. India’s coronavirus disease tally has mounted to 4,754,356 and the death toll has climbed to 78,586, data showed. And, the country’s economy contracted by 23.9% in April-June period quarter.

Gold prices in India ended the week at Rs 51,280 per 10 gram and have been down nearly Rs 5,000 from record highs of Rs 56,200 last month. However, gold is up about 30% since the beginning of this year, tracking a global rally.

According to a Reuters report, dealers offered discounts of $30 an ounce over official domestic prices as compared to last week’s $40.

Experts have said developments on the anti-coronavirus vaccine front and improving economic data present near-term headwinds to gold but low and negative interest rates, weaker US dollar and expectations of further stimulus will keep the yellow metal supported.

Gold prices in India, which is the second-biggest buyer after China, include 12.5% import duty and 3% GST.

India’s gold imports declined 81.22% to $ 2.47 billion or Rs 18,590 crore in the April-July period of the current fiscal. Gold imports affect the country’s current account deficit (CAD). According to data from the ministry of commerce, the demand for gold has come down considerably in the midst of the coronavirus pandemic, which has, in turn, reduced imports.

(With agency inputs)