Rising gold prices curb festive demand in India

Gold prices have surged more than 25% this year, discouraging many Indian buyers during the crucial wedding and festival season. Purchases of the yellow metal traditionally spike in India during these periods. However, with prices now above $1,172 per 10 grams, many buyers are staying on the sidelines, Bloomberg reports.

India, which accounts for nearly 30% of global gold demand, is witnessing a significant shift in consumer behavior due to these high prices. While major jewelry companies are attempting to attract customers with discounts and installment plans, sales remain sluggish, falling 25% year-on-year last month. Analysts forecast that demand could decline by a further 11% by March 2026. Concurrently, lightweight jewelry is gaining popularity as consumers adapt. Experts suggest this trend could have a substantial impact on both India's gold industry and its broader economy.