Gold prices spurted by Rs 315 to trade at Rs 31,250 per 10 grams here immediately after government increased import duty on the metal to 6 per cent.
In the afternoon, gold prices were trading at Rs 30,935 per 10 grams. Rates shot up after the government announced a hike in the duty in the evening, traders said.
"Prices have increased by over Rs 300 per 10 gram after the import duty hike," All India Sarafa Association Vice President S K Jain told PTI.
The price of 99.9 and 99.5 per cent purity of gold is now Rs 31,250 and Rs 31,050 per 10 gram, respectively, against Saturday's price of Rs 30,910 per 10 grams and Rs 30,710 per 10 grams, he added.
Jain said sales, however, have not been impacted by sudden rise in prices.
The government increased the import duty on gold and platinum to 6 per cent, from 4 per cent earlier, with immediate effect - a move aimed at curbing imports of the precious metals to check the widening current account deficit.