India's Gold Buying Festival Sees Tepid Demand Amidst Record Price Surge

India's cherished Akshaya Tritiya festival, typically a period of robust gold purchasing, saw a muted response this year as soaring prices deterred many consumers. The auspicious occasion, second only to Dhanteras for gold buying, usually witnesses a surge in demand for jewelry. However, the record-high gold prices, which have climbed dramatically since the last festival, forced many shoppers to hold back, resulting in lower volumes of jewelry sales.

Despite the dip in jewelry demand, there was a silver lining with a modest uptick in investment demand. Consumers, perhaps sensing an opportunity amidst the high prices or seeking more liquid assets, shifted towards gold coins. Jewelers attempted to entice buyers by offering discounts on crafting fees, but the elevated price point remained a significant barrier. This trend reflects a broader shift in Indian gold-buying patterns, where price-sensitive consumers are increasingly making purchases throughout the year rather than concentrating solely on festival periods.

Data from the World Gold Council indicates a changing landscape, with a notable decrease in jewelry demand in 2025 contrasted by a rise in investment demand to its highest point since 2013. This evolving behavior, coupled with a recent government move to authorize banks for gold imports, suggests a dynamic market. From the perspective of CNA, this subdued festival demand highlights the impact of global price fluctuations on India's crucial gold market and the adaptive strategies consumers and businesses are employing in response.

“

The sharp rally in prices curbed jewellery demand. In volume terms, buying was lower as consumers held back, though in value terms spending was higher due to elevated prices.