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Informist, Friday, Jul. 18, 2025

 

NEW DELHI – India's jewellery demand is expected to recover from mid-August with the beginning of the festival and wedding season, the World Gold Council said. High prices and seasonal weakness had dampened jewellery purchases, and consumers preferred investment-led purchases of gold bars, coins, and chains as quasi-investments due to lower fabrication costs.

 

"Jewellery demand succumbed to seasonal weakness in June and early July, following the conclusion of the wedding season," the Council said. Studded jewellery and lightweight items remained popular purchases amid high prices, and some listed jewellers reported that up to 40% of their sales involved old gold, it added.

 

Nevertheless, major listed retailers posted robust revenue growth of 18–31% in the Apr-Jun quarter due to higher prices, even as volumes remained flat or moderate. Weddings-related sales in Apr-May also boosted revenue, it added.  

 

Gold will continue to attract strong investment buying going ahead. Gold has continued to outperform other asset classes, with global prices posting a 28% year-to-date gain. Prices rose 0.3% to $3,287 per ounce in June, and have climbed a further 2% so far in July. Domestically, prices rose 0.7% to INR 95,676 per 10 grams in June, and rose further by 1% to INR 97,095 per 10 grams this month. The re-emergence of trade risks, heightened geopolitical tensions, a weaker dollar, and softer US Treasury yields are supporting gold prices in July. 

 

Meanwhile, Indian gold exchange-traded funds continued to attract strong investor interest. According to data from the Association of Mutual Funds in India, net inflows into gold ETFs surged to INR 20.8 billion in June, the second-highest monthly inflow on record. Assets under management rose 88% on year to INR 648 billion, with total gold holdings climbing to 66.7 tonnes. The number of new accounts or folios rose by 280,000 in June, bringing the total investor count to 7.65 million.

 

On the supply side, gold imports in June fell to a 14-month low of $1.8 billion, down 26% on year and 28% from May. This is the third consecutive decline in imports. The estimated import volume stood between 19 tonnes and 24 tonnes, significantly below 31 tonnes in May.

 

The Reserve Bank of India also resumed gold purchases in June with a modest addition of 0.4 tonnes, the first since March. With this, the country's gold reserves rose to an all-time high of 880 tonnes. Gold now accounts for 12.1% of India's total foreign exchange reserves, the highest share on record.  End

 

 

US$1 = INR 86.13

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

 

Reported by Afra Abubacker

Edited by Deepshikha Bhardwaj

 

 

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