India Gold Market Cautiously Optimistic With Approach of Festive and Wedding Seasons - LinkedIn

AI desk brief

India’s gold market is cautiously optimistic heading into the festive and wedding season, with the WGC saying higher prices are weighing on jewelry demand but investment buying remains steady. August was exceptionally strong: London PM gold rose 13% to $4,386/oz, while rupee gold gained 12% to ₹158,854/10g before slipping 4.6% in early September after the Fed hike and higher oil prices.

Local pricing stayed below import parity by about 2%, suggesting adequate domestic supply. Discounts widened from $34/oz in July to $51/oz in August and $78/oz by Sept. 11, as old-gold exchange and unofficial supply boosted availability; Indian gold imports fell 45% in August to an estimated 15-20t.

ETF demand remains supportive even as new account growth slows: August inflows rose 67% MoM to ₹25.97bn ($272m), holdings increased 1.6t to 121.3t, and digital gold purchases were up 110% YoY in August. WGC expects demand to improve into Navratri, Dhanteras and Diwali, though elevated prices and volatility may keep discretionary buying capped.