According to Kavita Chacko, Research Head for India at the World Gold Council, domestic gold prices surged 12% in August to INR158,854 per 10g, mirroring a global rally fueled by a softer US dollar. However, shifting expectations regarding Federal Reserve policy led to a pullback in September. This price sensitivity has caused domestic gold to trade at significant discounts—reaching US$78/oz below import parity by mid-September—as a combination of old gold recycling and unofficial supply saturated the local market.

Investment behavior is undergoing a structural shift. While Indian gold ETFs recorded a 67% month-over-month inflow increase in August to reach $272 million, the influx of new retail accounts has slowed sharply compared to earlier this year. Simultaneously, digital gold purchases have gained momentum, with August volumes rising 110% year-over-year. Despite a 45% monthly decline in physical gold imports, the industry remains cautiously optimistic that wedding-related demand will provide a floor for the market as the peak festive season unfolds.