As gold prices fell, people collapsed! 30% increase in gold purchases

According to the India Bullion and Jewelers Association (IBJA), higher prices despite Indians ramping up purchases of precious metals during Dhanteras-Diwali. Gold purchases increased by 30% and silver demand by 10% compared to the same period last year. Jewelers say this is a sign of increased demand ahead of the upcoming important wedding season. According to Udyog Mandal, this year during Dhanteras-Diwali, consumers spent Rs. 72,000 crore worth 52 tonnes of gold and Rs. 5,400 crore 300 tonnes of silver was bought. A drop in gold prices – which is around Rs. 1.8 lakh from a high of Rs. 1.42 lakh per 10 grams – prompting buyers to come back into the market. Advance purchases for the wedding season, which runs from mid-November to March, also contributed to the increase.

Good business

IBJA National Secretary Surendra Mehta said that the business of jewelers has been good on Dhanteras and Diwali this year. He said demand in the market was subdued as many consumers stopped buying after Prime Minister Narendra Modi’s appeal not to buy gold. Consumers moved away from precious metals. But now that prices have come down and Brent crude prices are likely to rise again, people have come out to buy gold. In fact, the shopping is still going on. The festive season was also favorable for shopping. Dhanteras fell on November 6 and Diwali on November 8. This was the beginning of the month, when most salaried people get their salary and festive bonus.

Gold has given good returns in the last few years

All India Gem and Jewelery Domestic Council Chairman Rajesh Rokde said this led to good cash flow in the market, due to which consumers bought enthusiastically. Gold prices have also remained relatively low in the last four to six months, further improving public buying sentiment. By September this fiscal, gold sales had fallen by nearly 50 percent due to price and import duty hikes and PM Modi’s appeal to avoid buying gold. Gold has given very good returns in the last few years. Its price was around Rs 60,000 per 10 grams in 2023, rising to Rs 80,000 in 2024, Rs 1.15-1.20 lakh in 2025 and around Rs 1.42 lakh during Dhanteras-Diwali this year. Silver prices have also seen a sharp rise.

Third largest purchase of the decade

An analysis of Bengaluru-based C Krishnaya Chetty Jewellers’ business over the past eight years shows that gold sales during this festive season were the third highest in the last decade. This has happened when gold prices were nearly 10 percent higher a year ago. C Vinod Hayagriva, director of ‘C Krishnaya Chetty Jewellers’, said in an ET report that consumer confidence in gold jewelery is still intact. Despite the steep rise in prices over the past 12 months, consumers have maintained their faith in gold.

Natural diamond sales boom

Sales of natural diamonds also showed strength, the second highest in eight years. According to the retailer, sales of natural diamonds increased by 250% on Dhanteras and 47% during Diwali. This is at a time when the natural diamond industry is facing several challenges. Such as a global ban on supplies from Russia and increased competition from lab-grown diamonds. Lab-grown diamonds are emerging as a supplement to, rather than a replacement for, natural diamonds.