Gold Prices Surge, But Demand Plummets in India
India’s gold demand fell sharply by 15% to 118.1 tonnes in the March quarter, marking the steepest decline in five years, according to the World Gold Council (WGC). The surge in prices—crossing ₹1 lakh per 10 grams for the first time—deterred jewellery buyers but strengthened gold’s appeal as a safe-haven investment.
Jewellery Demand Takes a Hit
- Gold jewellery sales plunged 25% to 71.4 tonnes as consumers cut back on discretionary spending.
- High prices forced buyers to postpone purchases, especially during key festivals and weddings.
- Physical gold prices remained elevated, trading around ₹95,689 per 10 grams in local markets.
Investment Demand Stays Strong
While jewellery demand weakened, gold investments grew 7% year-on-year to 46.7 tonnes, driven by:
- Gold ETFs (Exchange-Traded Funds)
- Digital gold platforms
- Coins and bars
Investors flocked to gold as a hedge against inflation and economic uncertainty, reinforcing its status as a safe-haven asset.
What’s Next for India’s Gold Market?
- Wedding and festive season demand may recover if prices stabilize.
- Rural markets, heavily dependent on gold purchases, could see slower recovery due to high prices.
- Investor interest is expected to remain strong amid global economic volatility.
Will gold prices cool down, or will India’s love for jewellery continue to fade? Stay updated on the latest trends in gold demand and pricing.
