Gold: As prices skyrocket, demand falls by 15% in three months, says WGC
Virendra Pandit
New Delhi: India, believed to be the world’s largest gold consumer, has seen its demand for the yellow metal fall by 15 percent this year because of skyrocketing prices, the World Gold Council (WGC) has said.
This decline in sales volume was offset by a 22 percent surge (in rupee terms) in the overall value of demand, propelled by soaring global gold prices, which have risen 25 percent since January 2025.
The media reported on Wednesday that India’s gold demand witnessed a 15 percent year-on-year decline to 118.1 tonnes in the January-March quarter of this year, compared to 139 tons in Q1FY25, even as value grew by 22 percent to as high as Rs 94,030 crore due to surging prices. On Wednesday, the yellow metal cost Rs. 93,868 per 10 gm.
According to the WGC forecast, India’s gold demand for 2025 is expected to be between 700-800 tonnes.
The average quarterly gold price in the Q1FY26 was Rs 79,633.4 per 10 grams, compared to Rs 55,247.2 in Q1FY25.
The global gold demand has increased 1 percent to 1,206 tonnes in the January-March quarter of 2025 — the highest first-quarter level since 2019.
“This historic rally of gold prices reaching a record high of Rs 1 lakh per 10 grams in India has reinforced the metal’s appeal as a safe-haven asset among Indian consumers,” Sachin Jain, Regional CEO, India, WGC, said.
The uncertainties surrounding US President Donald Trump’s reciprocal tariffs plan and counter-tariffs have fuelled international gold prices. Analysts believe that safe-haven of gold will remain elevated in the event of a possible escalation in the ongoing trade war. Data revealed that international gold prices rose at an unprecedented pace in 2025, soaring over 20 percent. Over the past year, they have risen about 40 percent.
The investment demand in the first quarter remained resilient, rising 7 percent year-on-year to 46.7 tonnes, driven by growing interest in gold ETFs (exchange traded funds), digital gold, coins, and bars, the WGC said.
Gold jewellery demand in India declined by 25 percent to 71.4 tonnes from 95.5 tonnes in Q1FY24, with elevated prices impacting affordability.
“Yet, the enduring cultural and seasonal significance of gold, especially ahead of key occasions like Akshaya Tritiya and the upcoming wedding season, continues to support the consumer’s buying sentiment,” Jain asserted.
“Gold retailers, too, are optimistic about favourable buying behaviour through the rest of the festive season, despite ongoing tariff-related uncertainties.”
The 8 percent rise in gold imports to 167.4 tonnes in the January-March 2025 quarter reinforces this supply-side preparedness by Indian jewellery retailers, WGC said. In contrast, gold recycling fell by 32 percent to 26 tonnes, as consumers retained their holdings amid record-high prices.
“With cultural affinity, festive momentum, and resilient investment interest, India’s gold story is poised to shine even brighter in the months ahead,” Jain said.
