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Published 16:31 IST, February 5th 2025

Gold Demand in India Surges: Will Yellow Metal Get More Expensive In 2025?

According to WGC's report, gold demand stood at 802.8 tonnes in 2024, up from 761 tonnes in 2023.

Reported by: Business Desk
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Gold coin
Gold coin | Image: Unsplash

Gold demand in India has risen by 5% in 2024, reaching 802.8 tonnes, driven by factors such as lower import duties and increased purchases during wedding seasons and festivals. The World Gold Council (WGC) has projected that demand in 2025 will likely range between 700 and 800 tonnes.

According to WGC's report, gold demand stood at 802.8 tonnes in 2024, up from 761 tonnes in 2023. The total value of gold demand surged by 31%, hitting Rs 5,15,390 crore compared to Rs 3,92,000 crore the previous year.

2025 gold demand outlook

WGC's India CEO, Sachin Jain, told PTI that gold demand for 2025 is expected to fall within the 700-800 tonnes range, with the jewellery segment anticipated to recover due to wedding-related purchases, provided there is price stability.

The price of gold has reached new record highs over the past year. As per the All India Sarafa Association, gold prices continued their upward momentum, climbing Rs 500 to Rs 85,800 per 10 grams, a fresh record, driven by strong demand from jewellers and retailers.

In 2024, gold prices rose by Rs 6,410 or 8.07%, reaching Rs 85,800 per 10 grams from Rs 79,390 on January 1.

The fourth quarter of 2024 saw steady demand, with figures almost identical to the previous year's at 265.8 tonnes. However, the demand for gold jewellery in 2024 saw a slight decline of 2%, dropping to 563.4 tonnes compared to 575.8 tonnes in 2023.

Jain attributed the resilience of jewellery demand to a reduction in import duties in July, which helped offset price hikes. Despite the price rise, the volume of jewellery demand remained strong, underscoring the stability of the market. Many consumers took advantage of the duty cut in the third quarter, mitigating some of the price increase.

Gold investment hits peak

The value of total gold demand increased by 22% in 2024. Investment demand for gold surged by 29% in 2024, reaching 239.4 tonnes—its highest level since 2013—compared to 185.2 tonnes the previous year.

Gold recycling declined by 2% in 2024, standing at 114.3 tonnes, down from 117.1 tonnes in 2023. Additionally, India's gold imports dropped by 4%, totalling 712.1 tonnes in 2024, compared to 744 tonnes in 2023.

Gold exchange-traded funds (ETFs) saw steady demand throughout the year, particularly during the Dhanteras and Diwali festivals. Online platforms also contributed to a boost in gold purchases, offering consumers rapid delivery of smaller gold bars and coins in major cities.

The Reserve Bank of India (RBI) was a notable buyer of gold, acquiring 73 tonnes in 2024, more than quadrupling its gold purchases from 16 tonnes in 2023. Jain remarked that the demand for gold investments, including ETFs, digital gold, and gold coins, is expected to remain strong in the future, with retail investors showing continued interest.

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Updated 16:31 IST, February 5th 2025