Gold At Record Highs Pushes Indians Toward Coins And Bars, Away From Jewellery: Report

The gold market in India is undergoing a major shift as domestic prices hit record highs. Buyers are reportedly cutting back on purchases of traditional gold ornaments, and accumulating bars, coins and financial products backed by gold instead.

In 2025, gold prices increased by 77% in India, where the metal is valued both financially and emotionally. According to Reuters, the rally has far exceeded the 9.7% increase in the Nifty 50 index. Consumer behaviour has changed as a result of this momentum. Those who used to buy gold jewellery for weddings and festivals are now focusing on products with greater liquidity and lower additional costs.

Mumbai resident Prachi Kadam, who usually buys gold jewellery, changed her strategy this year due to the rise in costs. “It’s hard to justify paying an additional 15% in making charges. So, I settled for a 10-gram coin this time,” Kadam told Reuters.

Industry representatives told Reuters the shift toward investment-grade gold is softening the impact of lower jewellery sales and may continue to be a major trend for the next two years. They added the pattern was similar to international marketplaces, where high prices deter people from buying ornaments.

Instead of completely moving to bars or coins, some Indian households are making adjustments by buying less gold. Nibedita Chakraborty, a customer from Kolkata, said that growing costs have made her reconsider her expenditures. “Even reducing the weight of a gold necklace by six or seven grams can save more than Rs 1 lakh,” Chakraborty said, as Reuters mentioned.

Jewellers indicate that consumers are choosing products that strike a mix between affordability and aesthetics. In response to shifting consumer tastes, jewellery manufacturer PN Gadgil Jewellers introduced a lighter, lower-carat sub-brand in June. “Buyers want pieces that allow them to participate in gold ownership without feeling price pressure, and modern craftsmanship has made lightweight jewellery aspirational rather than entry-level,” Reuters quoted Saurabh Gadgil, the company’s chairman, as saying.

World Gold Council (WGC) data supports this change. In the first nine months of 2025, India’s overall demand for gold decreased by 14% annually. Investment demand increased 13% to 185 tonnes, while jewellery consumption fell 26% to 278 metric tonnes. Additionally, the WGC stated that $3.3 billion in inflows, or 28.7 tonnes, were received by India-listed gold exchange-traded funds this year, increasing holdings to 86.2 tonnes.

The India Bullion and Jewellers Association said that prices may not ease soon and predicts that the trend will continue. “Consumers are purchasing gold in the form of coins, bars or gold ETFs, assuming that the rally will continue,” said Prithviraj Kothari, president of the association.

Even manufacturers agree about the growing popularity of 18-carat and 14-carat pieces, especially among young people. “These pieces allow buyers to manage budgets while still enjoying appealing designs,” said Santosh Kataria, chairman of DP Abhushan Ltd.

According to analysts, if bullion keeps outperforming other asset classes, the trend toward investment gold may stay firmly established.