New Delhi | July 31, 2026
India’s Gold Demand Falls 6% in Q2 2026, But Consumers Spend Record ₹1.98 Lakh Crore as Prices Surge
Indian households purchased less gold during the April–June 2026 quarter, but ended up spending significantly more as soaring prices pushed the value of purchases to a record high. According to the World Gold Council (WGC), India’s total gold demand declined 6% year-on-year to 131.4 tonnes, down from 139.7 tonnes in the same period last year.
Despite the decline in physical demand, consumers spent ₹1.98 lakh crore on gold during the quarter—an increase of nearly 50% from ₹1.33 lakh crore a year earlier—reflecting the sharp rise in domestic gold prices.
Gold Purchases Decline by 8.3 Tonnes
The WGC report shows that Indian families purchased 8.3 tonnes less gold than they did during the April–June quarter of 2025.
The decline came as gold prices climbed to historic highs, making purchases significantly more expensive despite lower volumes.
During the quarter, the average gold price in India reached ₹150,744 per 10 grams, compared with ₹94,875 per 10 grams in the corresponding period last year.
As a result, households spent approximately ₹65,000 crore more on gold despite buying less.
Consumers Shift to Lighter and Lower-Carat Jewellery
According to Sachin Jain, Regional CEO of the World Gold Council India, consumers are adapting to higher gold prices rather than abandoning purchases altogether.
To stay within their budgets, buyers are increasingly opting for:
- Lightweight jewellery
- Lower-carat gold ornaments
- Smaller-ticket purchases
This trend reflects changing consumer preferences as households seek affordable alternatives amid sustained price increases.
Record Prices Push Spending to New High
Although demand by volume weakened, the monetary value of gold purchases reached a record level.
Key figures for April–June 2026:
- Gold demand: 131.4 tonnes
- Year-on-year decline: 6%
- Average price: ₹150,744 per 10 grams
- Total consumer spending: ₹1.98 lakh crore
- Increase in spending: Nearly 50% year-on-year
The report highlights how rising bullion prices have reshaped purchasing behavior across India’s gold market.
Higher Import Duty Linked to Rise in Gold Smuggling
The report also points to an increase in gold smuggling following the government’s decision to raise the gold import duty to 15% on May 13, 2026.
The higher tariff was introduced to:
- Manage gold imports
- Reduce the trade deficit
- Ease pressure on the Indian rupee
However, authorities have reported a noticeable rise in illegal gold inflows after the duty hike.
Gold Seizures Nearly Double After Duty Increase
According to information presented by the government in Parliament, enforcement agencies seized:
- 160.91 kilograms of smuggled gold between May 13 and June 30
- 86.16 kilograms between April 1 and May 12
The figures indicate that gold seizures nearly doubled following the increase in import duties, suggesting a rise in smuggling attempts.
Outlook for India’s Gold Market
Market analysts believe demand may remain sensitive to future movements in gold prices, festive-season buying, and broader economic conditions.
If prices remain elevated, consumers are expected to continue favoring lighter jewellery and lower-carat products, while investment demand may depend on global economic uncertainty and central bank policies.
Key Highlights
- India’s gold demand fell 6% to 131.4 tonnes in Q2 2026.
- Consumers spent a record ₹1.98 lakh crore, up nearly 50% year-on-year.
- Average gold prices rose to ₹150,744 per 10 grams.
- Buyers increasingly chose lighter and lower-carat jewellery.
- Gold import duty was raised to 15% on May 13, 2026.
- Gold seizures increased from 86.16 kg to 160.91 kg after the duty hike.
Official Sources
- World Gold Council (WGC) – Gold Demand Trends Report, Q2 2026.
- Government of India – Parliamentary data on gold seizures and import duty.
