India Gold Demand May Hit Six-Year Low In 2026 As High Prices, Weak Monsoon Hurt Jewellery Sales: World Gold Council
India's gold demand could decline to its lowest level in six years during 2026 as elevated prices, weaker jewellery purchases and slowing investment demand affect consumption, according to the World Gold Council (WGC). As per a Reuters report, the world's second-largest gold consumer after China is facing pressure from rising living costs and reduced rural purchasing power following a weak…
India's gold consumption could reach its lowest point in six years by 2026, according to forecasts from the World Gold Council. Rising costs of living and diminished rural purchasing power, exacerbated by a weak monsoon season, are contributing to a slowdown in demand for the precious metal. The council predicts total gold demand to fall to around 650 metric tonnes, marking the lowest level since 2020.
The impact of Covid-related restrictions is still being felt, with jewellery stores closed and purchases sharply reduced. Gold prices in Gwalior dropped by ₹42,000, leading to a surge in jewellery sales ahead of key festivals. However, jewellery demand has plummeted by 20%, while investment demand has plunged 40%. Rural consumers, who represent more than half of India's gold demand, are particularly vulnerable.
The monsoon's weakest rainfall in a decade has damaged agriculture and reduced farmers' incomes, further dampening spending power. Despite some anticipated uplift during the December quarter due to festivals and weddings, high gold prices and weak rural spending are expected to persist, posing significant challenges for India's gold market.
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