Margin on gold futures raised to 5%

Amid volatility in gold prices, the commodity market regulator Forward Markets Commission (FMC) has raised the initial margin on gold futures to 5% of the value of contract from 4%, on all the exchanges in the country.

The increased rate of margin will be effective from September 2.

"The Exchanges are directed to impose initial margin on gold contracts (all gold contracts) at the rate of 5% of the value of the contract," FMC said in a directive.

In view of the current price volatility, the Commission has also decided to impose  additional margin of 5% on all the Gold, Silver, Brent Crude Oil, Crude Oil and Natural Gas contracts traded on the National Exchanges till further orders.

However, gold prices fell by 0.57%, to Rs 33,438 per 10 grams in futures market in early trade today as speculators indulged in trimming positions.

At the Multi Commodity Exchange, gold for delivery in far-month December declined by Rs 193, or 0.57%, to Rs 33,438 per 10 grams in business turnover of 12 lots.

Similarly, gold for delivery in October lost Rs 174, or 0.52%, to Rs 33,476 per 10 grams in 305 lots.