By The Sampadak Express
Value of gold purchases jumps 22% as prices surge; wedding and festival demand offers supportIndia’s gold demand fell 15% year-on-year to 118.1 tonnes in the January–March quarter of 2025, according to the latest report by the World Gold Council (WGC). Despite the drop in volume, the value of gold purchases surged 22% to Rs 94,030 crore, driven by a sharp rise in prices.
Gold prices have climbed 25% since the beginning of the year, nearing the key psychological mark of Rs 1,00,000 per 10 grams. This price rally has affected consumer affordability and led many buyers to either downsize purchases or postpone them in anticipation of a correction.
Cultural Demand Steadies Market
WGC India CEO Sachin Jain noted that while high prices have dampened affordability, gold’s deep cultural significance — especially around Akshaya Tritiya and the upcoming wedding season — continues to support buyer sentiment.
Experts observed that although many consumers are opting for lighter jewellery pieces, demand linked to weddings has remained relatively stable, underscoring the essential nature of gold in traditional Indian ceremonies.
Jewellery Demand Drops, Investment Holds Firm
Jewellery demand saw a sharp 25% decline to 71.4 tonnes — the lowest first-quarter level since 2020 — compared to 95.5 tonnes in the same period last year. However, in value terms, this still marked a 3% increase, reflecting the steep rise in prices.
In contrast, investment demand showed resilience, rising 7% year-on-year to 46.7 tonnes. Demand for gold bars and coins also saw an uptick as investors turned to gold as a safe-haven asset amid global financial uncertainties.
Imports Up, Recycling Down
India’s gold imports rose 8% to 167.4 tonnes during the quarter, while gold recycling fell sharply by 32% to 26 tonnes. The WGC attributed the drop in recycling to consumers choosing to hold onto their gold amid record-high prices.
The average gold price for the quarter stood at Rs 79,633 per 10 grams, significantly higher than Rs 55,247 recorded in Q1 2024.
Global Gold Demand Also Rises
Globally, gold demand rose 1% year-on-year to 1,206 tonnes in the January–March period, marking the strongest first-quarter performance since 2019.
Looking ahead, the WGC projects India’s gold demand for 2025 to fall within the range of 700 to 800 tonnes, with price trends, economic conditions, and cultural factors expected to shape consumer behavior throughout the year.
