Festive Demand Hinges on Gold Price Volatility Ahead of Indian Wedding Season

The demand for gold jewelry in India has cooled off due to sharp price swings ahead of the festive and wedding season, according to the World Gold Council. Despite this, the WGC is optimistic that demand could improve across the country in the coming weeks as festivals and weddings gather pace.

The London Bullion Market Association (LBMA) Gold Price PM rose 13% in August to $4,386 an ounce, while domestic gold prices climbed 12% during the month. However, this sharp rise was followed by a lag in September, with international gold prices down 3.90% for the month and domestic prices falling 4.6%.

The WGC notes that wedding-related purchases have been more resilient, but there is still a shift towards lighter-weight jewelry as buyers look to manage costs. The coming weeks could bring stronger demand for jewelry as festivals and weddings gather pace, with consumers buying jewelry for traditional occasions less likely to delay purchases despite sharp price movements.