Gold jewellery sales in India are anticipated to decline during the upcoming festival season as soaring bullion prices lead buyers to explore more affordable options in one of the world’s largest markets.
According to Surendra Mehta, national secretary at the India Bullion and Jewellers Association, demand for gold ornaments is expected to drop by as much as 27% in volume terms during the three-week buying period compared to last year. Consumers, particularly in major cities, are deferring purchases due to elevated costs.
Gold is traditionally associated with weddings and special occasions in India, and it is also a preferred investment choice. However, during a time when jewellery demand typically surges, with the buying season beginning with the nine-day Navratri festival in September and extending to Diwali in October, bullion prices have surged nearly 50% compared to the same period last year.
During the festival of Dhanteras, which signals the beginning of Diwali celebrations, gold outlets across India typically remain open until midnight, as this is considered an auspicious time for gold and silver purchases. Jewellery comprises about 70% of India’s total bullion consumption, making these several weeks crucial for local sellers’ annual revenue.
Currently, local prices are hovering above ₹1 lakh ($1,128) per 10 grams, which is discouraging consumers, many of whom adhere to a fixed budget. As a result, many buyers are opting for lighter pieces than they would prefer.
Global spot prices for gold have more than doubled over the past two years, reaching an unprecedented high of $3,791.10 per ounce this week.
Demand for gold jewellery has faced challenges throughout much of the year, with India’s purchases from April to June down 17% year-over-year. According to a World Gold Council report in July, total gold purchases in 2025 are projected to hit the lowest level in five years.
Arham Ahmad, a jeweller based in Delhi, noted, “Most of the demand now is for lightweight or more affordable pieces.” Customers visiting his shop often choose small ornaments weighing as little as two grams, indicating a shift in purchasing behavior. “Demand for heavier jewellery has been subdued for quite some time,” he added.
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Published on September 26, 2025.
