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Informist, Wednesday, Apr. 30, 2025

 

By Sandeep Sinha

 

MUMBAI – Appreciation in the rupee and a correction in gold prices ahead of the Akshay Tritiya brought a degree of relief for the jewellery sector as footfall at stores surged and demand improved in the evening. The demand is now seen down 20% on year compared with an earlier estimate of a 40?ll in volume term after the yellow metal prices stabilised around INR 94,000-INR 95,000 per 10 gram in the domestic market.

 

Buying gold on Akshay Tritiya is considered auspicious as it is believed to bring wealth and prosperity. Akshay Tritiya, which is being celebrated Wednesday, is the most significant shopping day for gold and silver jewelleries across the country. Jewellers offer attractive schemes such as lucky draws and discounts on making charges to attract buyers.

 

The price of 24-carat gold in Mumbai was INR 94,361 per 10 gram, along with a 3% goods and services tax, down from INR 99,100 touched on Apr. 22. The 22-carat gold was priced at INR 86,435 per 10 grams, plus GST, down from INR 90,776. During Akshay Tritiya last year, gold prices were around INR 70,000-INR 71,000 per 10 gm in the domestic market.

 

The rupee strengthened nearly 4% against the dollar from the low of 87.95 reached on Feb. 10 to settle at 84.48 on Wednesday. A firm rupee makes precious metals priced in dollars cheaper for domestic buyers.

 

"Gold demand this Akshaya Tritiya is expected to be slightly lower than last year in volume terms due to record-high prices, which have touched INR 95,000 per 10 grams. Many consumers are showing hesitation in purchasing large quantity of gold jewellery, opting instead for smaller denominations, coins, bars, or digital gold," said Prithviraj Kothari, managing director of RiddiSiddhi Bullions Ltd.

 

He said consumers are looking for value-driven purchases that offer liquidity, lower making charges, and better resale potential. Additionally, younger, urban investors are increasingly choosing digital gold and exchange-traded funds for convenience and security. "The emotional and cultural pull of gold remains strong, but it's being channelled more toward financial products than ornamental gold this year," Kothari said.

 

"Jewellery sales during Akshay Tritiya have been extremely good in south India. However, jewellers saw very few footfalls in the rest of India. The corporate multi-chain stores look to have done well. However single retail shops have performed extremely poorly on this festive day," Surendra Mehta, national secretary at India Bullion and Jewellers Association told Informist.

 

Overall demand in terms of value will be almost equal to last year but overall gold sales in volume seem to have dropped by at least 15%. Gold demand this Akshay Tritiya is expected to be around 20 tonnes against 24-25 tonnes last year, Mehta said. "Sales in bullion capital of the country, Mumbai, is projected at 2.5 tonnes, valued at approximately INR 23.5 billion. Light weight jewellery, low caratage jewellery, and coins are in good demand. Overall higher gold prices have been the reason for sluggish demand."

 

"Gold purchases have traditionally been an integral part of Akshaya Tritiya celebrations for millions of Indians, symbolising prosperity and good fortune. We are currently witnessing, sky rocketing gold prices – 'gold's era'. This year marks a significant period for gold, with global prices increasing 25% since January and reaching a record high of $3,500 per ounce. In India, gold prices have hit historic highs of INR 100,000 per 10 grams, reinforcing the belief in the yellow metal," said Sachin Jain, regional chief executive officer, India, World Gold Council.

 

Saurabh Gadgil, the chairman and managing Director, PNG Jewellers, said despite record-high gold prices, consumer sentiment remains upbeat, and people have accepted the price trend and are buying with confidence. "Akshay Tritiya continues to be the single largest gold-buying day across India, with the auspicious mahurat spanning from morning till midnight today. So far, customer response has been very welcoming and appears to be on a par with this year's Gudi Padwa, which delivered exceptional sales for us," Gadgil said.

 

While 10 gram coins remained in demand among serious investors, high prices have shifted attention to lower-weight coins that offer flexibility and preserve the cultural essence of the festival at a lower cost, Kothari said. "Smaller denomination gold coins of 1 and 2 grams are likely to see stronger traction this Akshaya Tritiya compared with 10-gram coins. With gold prices at record highs, many consumers are opting for affordable entry points to maintain the tradition of buying gold without straining their budgets."

 

Gold's status as a safe haven is at an all-time high, and it is expected Indians will continue to purchase gold this Akshaya Tritiya regardless of price fluctuations. Industry feedback suggests a strong buyer interest in various forms of gold, including higher carat gold jewellery, gold ETFs, digital gold, and coins and bars, further solidifying gold's role in Indian households, said WGC India's Jain.

 

M.P. Ahammed, the chairman of Malabar Group, said we are offering discounts on marking charges on the occasion of Akshaya Tritiya. Walk-ins or footfalls to our stores across the country have been healthy. On the back of the upward gold price movement, customers are becoming discerning--putting greater emphasis on quality and purity standards, design excellence, and offers while purchasing precious jewellery.

 

On the gold price outlook for the next year's Akshay Tritiya, Kothari said the returns on gold will largely depend on global economic trends, central bank policies, and geopolitical developments. "Given the current elevated price levels--around INR 95,000 per 10 grams--the upside may be less measured compared to past rallies. If the US Federal Reserve initiates rate cuts and geopolitical tensions persist, gold could remain supported, potentially offering returns in the range of 6–10% over the next year."

 

However, if inflation cools, the dollar strengthens, or equity markets rally, gold prices may stabilise or even face mild corrections. Investors should keep expectations moderate and focus on long-term value rather than short-term gains, Kothari added.  End

 

US$1 = INR 84.48

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Akul Nishant Akhoury

 

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