Thu Feb 26 05:31:21 UTC 2026: ### Gold Prices Plummet After Budget Presentation, Affecting Investment and Zakat Calculations

The Story:
Gold prices have experienced a significant downturn in India, starting the week on a weak note after a steep decline that began following the Union Budget presentation on February 1, 2026. After reaching an all-time peak in January 2026, marking a 20 percent increase, gold prices have since dropped by over 12 percent in just ten days. This price correction is impacting investment strategies and potentially influencing Zakat calculations for the upcoming Ramadan.

Key Points:

  • Gold prices started the week with a downward trend after a sharp decline.
  • Gold prices in India hit an all-time peak in January 2026, increasing by almost 20 percent.
  • Prices fell by over 12 percent following the Union Budget presentation on February 1, 2026.
  • 24-karat gold fell by ₹21 to ₹16,168 per gram.
  • 22-karat gold dropped by ₹20 to ₹14,820 per gram.
  • 18-karat gold decreased by ₹16 to ₹12,126 per gram.

Critical Analysis:
The immediate drop in gold prices following the Union Budget suggests that the budget either contained measures that dampened investor enthusiasm for gold or revealed broader economic strategies that shifted investment priorities. Profit booking, as indicated in the related news snippets, is also contributing to the decline. Investors likely took advantage of the high prices in January to secure profits, leading to a sell-off that further depressed prices.

Key Takeaways:

  • Government fiscal policy, as reflected in the Union Budget, has a significant and immediate impact on gold prices.
  • Profit-taking activities by investors can exacerbate price declines.
  • Fluctuations in gold prices directly affect investment strategies and wealth calculations, impacting religious obligations like Zakat.
  • The 24-karat gold price is considered the benchmark for investment purposes.
  • The Indian gold market is sensitive to both domestic policy changes and global market trends.

Impact Analysis:
The volatility in gold prices has several potential long-term implications. Firstly, it could lead to increased caution among investors, particularly those who view gold as a safe-haven asset. Secondly, the fluctuation could impact the jewelry industry, which relies heavily on 22-karat and 18-karat gold. Finally, the changing gold prices will affect the calculations of Zakat, a mandatory charitable contribution for Muslims, particularly during Ramadan, potentially influencing the amount of charity given. This may require religious scholars to provide updated guidance on how to calculate Zakat in light of the volatile market conditions.

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