India gold demand seen falling 7% on year to 725 tn in FY26, says UBS
This story was originally published at 20:25 IST on 17 June 2025
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NEW DELHI – Demand for gold in India is expected to fall 7% on year to 725 tonnes in 2025-26 (Apr-Mar), according to a report by multinational investment bank UBS. While investment demand is expected to remain firm in a rising price scenario, the bank expects jewellery demand to fall 5-10% on year in volume terms.
However, it expects India's gold demand to recover to 800 tonnes in FY27 as household consumption stablises. The bank sees gold prices rising to $3,500 per ounce in 2026, fuelled by escalating tariff uncertainty, weak growth, high inflation, and lingering geopolitical risks. At 1931 IST, the price of gold on the COMEX was down 0.3% at $3,408.6 per ounce.
"Volatility and high gold prices typically deter consumers and may cause them to delay purchases. In general, while consumers respond to price fluctuations in the near-term by buying into dips and delaying purchases when prices rise, they eventually adjust to higher prices and underlying demand stays resilient over the long run, even as gold prices trend higher," the report said.
Despite the sharp rise in gold prices last year, demand at most organised jewellers held up well, the bank said. It expects Titan to pursue an aggressive network rollout to strengthen its value proposition in order to continue capturing market share, which is quickly transitioning from an unorganised to an organised market. "While we like Titan's long-term proposition, our Neutral rating is a reflection of demand uncertainty in FY26 due to higher gold prices and a rich valuation." End
US$1 = INR 86.24
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Reported by Ashutosh Pati
Edited by Avishek Dutta
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