India Gold Prices Rise as Investment Demand Offsets Weak Jewellery Sales
Large and organised retailers reported relatively stable sales, while smaller jewellers continued to face subdued footfall.
SEATTLE (Scrap Monster): Gold prices continued to advance through November and into December, supported by a softer US dollar and sustained investment inflows, even as jewellery demand weakened. International gold prices climbed 4.5% in November and added another 3.7% by mid-December, driving year-to-date returns sharply higher. Indian gold prices tracked the global rally but outperformed, helped by rupee depreciation and firm investor interest.
India’s gold market shows a clear divide. Jewellery volumes slipped year-on-year despite the wedding season, as elevated prices and volatility constrained affordability. Although higher prices lifted overall jewellery value, demand in mass-market segments remained under pressure. Large and organised retailers reported relatively stable sales, while smaller jewellers continued to face subdued footfall.
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Investment demand remained resilient. Buying of bars, coins and exchange-traded funds stayed strong, reflected in elevated imports during mid-year months. Gold ETF inflows in November moderated from recent peaks but stayed well above historical averages, with momentum carrying into December.
Meanwhile, the Reserve Bank of India slowed bullion purchases, yet valuation gains lifted gold’s share of foreign exchange reserves. Gold imports fell sharply in November as post-festive demand cooled, although year-to-date import values