The sharp spike in gold prices — 30% over the past year — has dampened local demand for jewellery. Purchases for even weddings, the mainstay of the jewellery market, has been somewhat subdued, limited to light-weight jewellery.
Purchases on Akshaya Tritiya, the biggest gold-buying occasion of the year, are expected to be low-key. Local prices of 24 carat gold are currently hovering around Rs 95,000 per 10 gram and could well hit the Rs 100,000 mark by Akshaya Tritiya, which falls on April 30.
Rajiv Popley, director, Popley Group, concedes that the soaring gold prices does make jewellery purchases less affordable though he says that demand has been consistent. “With last year’s high volumes setting a benchmark, matching it won’t be easy,” Popley said.
Internationally, gold prices are currently in the region of $3,327 an ounce, having spiked due to the turmoil in the financial markets and the weakening US dollar after the Trump administration raised tariffs aggressively for imports into the US.
Meanwhile, central bankers have been adding gold to their portfolios. In fact, they have bought more than 1,000 tonne of gold for three years in a row (till 2024), according to data from the World Gold Council.
The global rally in gold prices continues unabated with 2024-25 turning in returns of 39.75% — the highest in four decades, according to data from Kedia Commodities. Since January, prices have risen by 27%. According to Goldman Sachs, the price of gold could hit $4,500/ounce by the end of 2025 in a high-risk scenario. The yellow metal is becoming increasingly popular as an asset class.
“The case for adding gold allocations has become more compelling than ever in this environment of escalating tariff uncertainty, weaker growth, higher inflation and lingering geopolitical risks,” UBS strategist Joni Teves wrote in a recent note. The changing global trade, economic, and geopolitical landscape is reinforcing the role of gold as a safer investment haven, Teves added.
Gold is among India’s top non-oil imports together with electronics and machinery. India imported $63.3 billion worth of gold in 2024-25, a jump of about 39% over the previous year. Spot prices of gold surged 32% in 2024-2025, as per MCX data, significantly outperforming the equity benchmark Nifty 50, which gained a little over 5%.
Ajay Kedia, director, Kedia Advisory, believes that the rally could slow down. “I feel prices may go up to $3,520/ounce at best and that there will be a downtrend thereafter till $2,700/ounce or even lower to $2,340/ounce,” he said.