India’s Q2 gold demand drops 6% as volatile prices delay jewellery purchases
India’s gold demand fell 6% year on year to 131 tonnes in the June quarter, with price volatility prompting consumers to defer jewellery buying. The quarter marked the second-lowest Q2 jewellery-demand level since 2000, signalling softer near-term trading conditions for jewellers.
What happened
Indian jewellery retail market · India’s gold demand fell 6% to 131 tonnes in the June quarter as volatile prices prompted consumers to defer jewellery
Key facts
- India's June-quarter gold demand fell 6% year-on-year to 131 tonnes
- Jewellery demand was the second lowest second-quarter level since 2000
- Physically backed gold ETFs received $2.62 billion in net inflows last week
Why this matters
Weaker jewellery demand may create opportunities to partner with or acquire smaller regional jewellers facing inventory pressure, particularly those lacking hedging and omnichannel capabilities.
What to watch
- Gold price direction and daily volatility in rupee terms, rather than international dollar prices alone.
- Dhanteras, Diwali and wedding-season booking trends, including advance-purchase conversion rates.
- Jewellery retailers' same-store sales, average ticket size, gram volumes and old-gold exchange mix.
- Rupee movement, import-duty changes and any policy measures affecting gold imports or recycling.
- Consumer shift between jewellery, coins/bars, gold ETFs and digital gold products.
- Inventory days, gross-margin commentary and hedging disclosures from listed jewellery chains.
- Increase promotion of lower-ticket, lightweight and modular jewellery collections to protect transaction volumes.
- Expand old-gold exchange, buyback and upgrade programmes to convert price-sensitive customers into store traffic.
- Use hedging and tighter replenishment cycles to limit inventory-mark-to-market risk during volatile gold prices.
- Prioritise festive-season inventory in proven fast-moving designs rather than broad speculative stock builds.
- Offer transparent price-lock, instalment and advance-booking plans to reduce customer anxiety over future price changes.
- Watch for organised chains to use advertising and loyalty campaigns to capture share from smaller local jewellers with less financing capacity.