Gold Prices to Plummet? Indians Shift from Jewellery to Investment, Demand Drops

• India's gold demand in 2025 was 711 tonnes, lowest in five years, projected to be 600-700 tonnes in 2026.
• Gold prices surged by 77% in 2025, significantly outpacing income growth, leading to a 24% drop in jewellery demand to 430 tonnes.
• Investment demand for gold rose by 17% to 280 tonnes in 2025, highest since 2013, accounting for 40% of total consumption.
• Investors favored gold over stock markets due to higher returns; Nifty 50 rose 10% while gold delivered much higher profits.
• Gold ETF investments soared by 283% in 2025, indicating a shift towards financial forms of gold over physical jewellery.

Why It Matters: Indians are shifting from physical gold jewellery to investments like ETFs, causing overall demand to drop despite price surges.