In the third quarter of 2026 (July - September), gold demand in India dropped by 29% compared to the same period last year, falling to 162.5 tonnes (down from 229.8 tonnes a year earlier). High prices for the precious metal continued to weigh on consumer demand. In monetary terms, however, demand rose by 3%, a direct result of an increase in gold prices.
According to a report by the World Gold Council (WGC), there was a positive quarter-on-quarter trend: following a decline in the second quarter, demand grew by 24% (up from 130.9 tonnes in the previous quarter). This increase was driven by a rise in seasonal jewellery purchases and a slight decline in gold prices toward the end of the quarter.
Demand for jewellery fell by 20% compared to the third quarter of 2025, reaching 99.9 tonnes (down from 125 tonnes a year earlier). In monetary terms, however, it increased by 16%. Compared to the second quarter, jewellery demand rose by 33%, bolstered by purchases for weddings and holidays—particularly in South India, where the festivals of Onam and Varalakshmi were celebrated in August.
Furthermore, a slight drop in gold prices toward the end of the quarter prompted some consumers to make purchases they had previously postponed. India maintained its position as the world’s largest jewellery market, accounting for 32% of global jewellery consumption in the third quarter of 2026. During the first nine months of the year, demand for jewellery fell by 18% compared to the same period last year, dropping to 241.1 tonnes; however, in monetary terms, it rose by 29%, reaching 361,830 crore rupees ($38.24 billion).
Investment demand also saw a slight decline compared to the exceptionally high figures of the previous year. Demand for gold bars and coins fell by 40% year-on-year to 55 tonnes (down from 91.6 tonnes in the third quarter of 2025), though it did show a 9% increase compared to the previous quarter.
The World Gold Council (WGC) attributes this downturn to a combination of factors: a high base for comparison, a slowdown in price momentum, and an increase in import duties on gold in May 2026. India remained the world’s second-largest market for bars and coins (after China), accounting for approximately 21% of global demand in this segment.
Total gold supply in India for the third quarter is estimated at 136 tonnes, a 43% decrease from the previous year. Net gold imports totalled 114 tonnes. Official imports of precious metals, including gold bars and doré, dropped sharply by 70% to 64 tonnes. This decline was driven by weaker physical demand, inventory adjustments, higher import duties, and the likely deferral of shipments ahead of the festive season in October.
The World Gold Council (WGC) forecasts that demand in the fourth quarter will be supported by the festive and wedding season. The Dhanteras and Diwali festivals are expected to boost gold purchases—whether for investment purposes, as gifts, or in the form of jewellery. At the same time, high prices and a weakening rural economy (following a poor monsoon season) may somewhat temper sales volumes.
According to estimates by the World Gold Council, total gold demand in India for 2026 is projected to reach 625 - 675 tonnes. The cultural significance of gold for the Indian people, combined with its role as a reliable store of value, is expected to sustain demand through the end of the year.
Hélène Tarin, Editor-in-Chief of the Asian Bureau, Rough&Polished
