Gold Drops 23% From Peak Is It Time to Buy Ahead of Diwali

Gold prices have dropped over 23% from their peak earlier this year, presenting a potential buying opportunity ahead of the Diwali festival. Analysts suggest a staggered approach to purchasing rather than a lump-sum investment, as consumers show a preference for lightweight and contemporary jewelry designs.

On January 28, 2026, international spot gold prices reached an all-time high of $5,419 per ounce. By October 5, the price had fallen to just above $4,155 per ounce. In the domestic market, MCX gold hit a yearly peak of Rs 2,47,917 per 10 grams before declining to Rs 1,49,270 per 10 grams on the same date.

Jewellers typically set their prices based on domestic spot gold rates from the Multi Commodity Exchange (MCX) and the India Bullion and Jewellers Association (IBJA), along with additional making charges and other costs. As of recent data, 24-karat gold was priced at around Rs 14,902 per gram in Mumbai, 22-karat gold at around Rs 13,675 per gram in Delhi, and 18-karat gold at around Rs 11,177 per gram in West Bengal.

Despite the price correction, industry players expect gold jewelry sales volumes to remain lower than last year's levels. Consumers are becoming more selective and cautious in their purchases, which could impact festive and wedding season demand.