India's Gold Market Hits Record Spending Amid Higher Prices
India's gold market reached an all-time high in Q2 2026, despite a 6% drop in demand volume to 131 tonnes. The total expenditure on gold rose to ₹1.98 lakh crore due to record-high prices, which were nearly 59% higher than the previous year.
The disparity between demand and spending is attributed to consumers opting for lighter ornaments and exchange schemes to manage elevated costs. Jewellery demand saw a sequential rise of 14% to reach 75 tonnes, but this recovery was not enough to surpass the previous year's levels.
Investment demand for gold bars, coins, and ETFs moderated to 54 tonnes during the quarter, cooling off after three consecutive quarters of robust growth. The purchase of gold bars and coins fell by 19% sequentially as buyers adopted a cautious approach following a sharp price rally.
Total gold availability dipped to a six-year low of 120 tonnes due to a 53% sequential decline in bullion imports triggered by higher import duties. However, high inventory levels and a rise in recycled gold helped satisfy demand.