Gold Prices Hit Record High, Dampening Dussehra Demand by 25%
Gold demand saw a significant shift during this year’s Dussehra celebrations. Sales volume dropped by an estimated 25% to 18 tonnes, compared to 24 tonnes sold during the festival last year, according to the India Bullion & Jewellers Association (IBJA).
The primary reason cited for the decline is the record-high price of the precious metal. On Dussehra, gold was priced at approximately ₹1.16 lakh per 10 grams, a sharp increase from ₹78,000 per 10 grams the previous year.
Despite the drop in volume, the value of sales actually rose by 30-35% due to these elevated prices. Buyers also pay an additional 3% GST on gold, along with making charges that can range from 15% to 30%.
While festive jewellery purchases softened, investment demand remained robust. There was notable strength in the sales of gold and silver coins, particularly 5 gm gold and 20 gm silver coins. Lightweight jewellery and old gold exchanges also performed well, accounting for a significant portion of total sales.
Many customers are already placing advance orders for upcoming occasions like Dhanteras, Diwali, and the wedding season, anticipating that prices are unlikely to decrease in the near future. Industry experts report that sentiment remains strong, setting a positive tone for the rest of the festive season.
