Surging Gold Prices Spark Shift from Jewellery to Investment in India

As gold prices soar to record highs, Indian consumers are shifting their purchasing habits from traditional gold jewellery to investment gold, such as coins and bars. This trend is driven by economic factors including currency fluctuations and is expected to continue, reflecting gold's cultural and financial importance in India.

Mumbai homemaker Prachi Kadam has for years combined tradition with a personal touch by purchasing gold jewellery each festive season. However, with prices reaching unprecedented levels, she opted for a 10-gram gold coin instead this year, reflecting a broader consumer shift in one of the world's largest gold markets.

India's traditionally robust gold market is undergoing a transformation due to a phenomenal rise in gold prices, which have surged 67% globally and 77% domestically this year. The shift from ornamental purchases to small coins and bars is cushioning the drop in overall demand and could continue into 2026, according to market analysts.

Faced with steep prices, many consumers, like Kolkata-based Nibedita Chakraborty, are modifying their buying habits, choosing lighter and lower-carat jewellery options. Meanwhile, investment instruments like gold-backed ETFs have attracted significant interest, underscoring gold's enduring role as a financial asset in India.