India’s gold market has entered a historic phase, with prices, investment demand, and digital participation reaching record levels. Rising global uncertainty, strong price momentum, and evolving consumer behaviour have collectively reshaped how Indians buy and invest in gold.
Gold Prices Climb to Fresh Records
Gold continued its strong upward trajectory into early 2026, building on an exceptional performance in the previous year. International prices surged sharply at the start of the year, posting multiple record highs and crossing the US$4,600 per ounce level. This followed a powerful rally through 2025, marking one of the strongest annual performances for gold in decades.
Domestic prices mirrored the global trend closely, pushing Indian gold rates to around ₹139,800 per 10 grams. The sustained rise has largely been driven by ongoing geopolitical tensions, policy uncertainty across major economies, and persistent demand for safe-haven assets. Continued inflows into gold-backed investment products have further strengthened price support.
Jewellery Demand Adapts to Higher Prices
Despite elevated prices, India’s gold demand environment remains resilient. Consumers have adjusted their buying patterns rather than stepping away entirely. Jewellery buyers are increasingly opting for lightweight designs, lower making charges, and smaller ticket sizes to stay within fixed budgets.
While 22-karat gold continues to dominate preferences, demand for 18-karat and even 14-karat jewellery has increased, reflecting heightened price sensitivity. Wedding-related purchases, which are largely need-based, have remained steady and continue to provide a strong foundation for jewellery demand.
An important trend shaping retail sales is the growing use of old gold exchange. Many retailers report that a significant portion of jewellery purchases now involve exchanging existing gold, underlining the value-conscious approach of today’s consumers.
Retailers Focus on Efficiency and Design
Jewellery retailers have responded to market conditions with a more disciplined approach to inventory management. Stocking decisions are increasingly driven by data, with an emphasis on faster inventory turnover, commercially efficient assortments, and design differentiation. This strategy has helped retailers navigate high-price environments while maintaining margins.
At the same time, investment-led demand has gained traction, with new buyers entering the market drawn by strong price momentum and gold’s long-term wealth preservation appeal.
Strong Performance from Listed Jewellers and Digital Channels
Listed jewellery companies reported robust revenue growth toward the end of 2025, although this growth was largely price-driven. Higher gold prices helped offset softer sales volumes. Plain gold jewellery performed particularly well, while gold coin sales nearly doubled year-on-year, reflecting rising investment interest.
Digital and e-commerce channels emerged as major growth drivers, with some jewellery companies recording triple-digit annual growth in online revenues. This shift highlights the growing comfort of Indian consumers with purchasing gold through digital platforms.
Gold ETFs Record Unprecedented Inflows
Gold exchange-traded funds (ETFs) were one of the standout performers in the Indian gold market. Investor interest remained strong throughout the year, with consistent monthly inflows culminating in a record-breaking December. Total holdings reached an all-time high, underscoring gold ETFs’ growing role as a portfolio diversification tool amid volatile equity markets.
Overall, 2025 marked a landmark year for Indian gold ETFs, with record inflows, rising assets under management, and a notable increase in India’s share of global gold ETF holdings. The domestic investor base expanded rapidly, with millions of new accounts added during the year.
Digital Gold Gains Momentum
Digital gold also saw rapid adoption, particularly through UPI-based platforms. Transaction values rose steadily through the year, nearly tripling by December. This growth was supported by ease of access, participation from first-time buyers, and an expanding ecosystem that includes jewellers, fintech firms, and digital platforms.
Although activity briefly slowed following regulatory advisories, buying interest quickly rebounded, indicating strong underlying demand and the growing importance of digital gold within India’s broader gold market.
Central Bank Buying Slows, Reserves Strengthen
In contrast to retail and investment demand, sovereign gold purchases moderated. The Reserve Bank of India reduced its gold buying significantly compared to the previous year. However, total gold reserves still stand at record levels, and the sharp rise in gold prices has increased the metal’s share within India’s foreign exchange reserves.
This suggests a more measured reserve management approach, where price appreciation itself has strengthened reserve valuations even with limited additional purchases.
Gold Imports: Higher Value, Lower Volumes
Gold imports reflected the impact of higher prices. While the overall value of imports rose modestly in recent months, volumes declined as elevated landed prices reduced buying quantities. Over the full year, import volumes fell noticeably, even as the total import bill remained broadly stable.
Imports were also significantly lower than the heavy inflows seen ahead of the festive season, indicating a return to more normalized buying patterns.
Outlook: Investment Demand to Lead
Looking ahead, seasonal wedding and festival demand is expected to provide incremental support to jewellery consumption. However, investment demand—through physical gold, ETFs, and digital formats—is likely to remain the primary driver of India’s gold market in the near term.
With evolving consumer preferences, expanding digital access, and gold’s continued appeal as a safe-haven asset, India’s gold story appears firmly positioned for long-term relevance.
