Gold Purchases Set to Rise: Prices Drop by Up to 25% Ahead of Dhanteras

Gold prices have fallen by nearly 25% from their record highs seen in January. Jewelers anticipate a 10–12% increase in gold sales this Dhanteras. Let’s explore whether this Dhanteras will indeed prove to be a highly profitable season for jewelers.

Buying gold on Dhanteras is considered auspicious. Every year, on this occasion, people purchase items like gold coins or jewelry, depending on their budget. This year, however, a decline in gold prices just before the festival has sparked new optimism. With gold now trading about 25% lower than its January peak, the question arises: will gold purchases in the market surge this Dhanteras?

Current market conditions suggest that demand for gold could see an uptick. Jewelers expect the volume of gold sales this Dhanteras to be 10–12% higher than last year. In other words, customers who had previously canceled their plans to buy gold due to high prices may now look to take advantage of this decline.

How much has gold dropped since January?

At the beginning of the year, gold prices experienced a sharp surge, with the price exceeding ₹1.80 lakh per 10 grams in January. Subsequently, a downward trend began. According to media reports, the price of gold in the domestic market has fallen by approximately 25% from its January peak.

Following this decline, gold has been trading at around ₹1.41 lakh per 10 grams. While gold is cheaper compared to its January peak, it remains about 10% more expensive than it was during last year’s Dhanteras. Therefore, it cannot be considered "cheaper" when compared to last year’s prices.

How much will gold purchases increase this Dhanteras?

According to media reports, the recent decline in gold prices has reignited consumer interest. There has been an increase in footfall at jewelry showrooms, and advance bookings for weddings have also picked up.

Surendra Mehta, National Secretary of the India Bullion and Jewellers Association, estimates that the volume of gold sales this Dhanteras could be 10–12% higher than last year.

Focusing on budget rather than weight

Despite the recent drop, gold prices remain quite high. Consequently, not every customer is in a position to purchase heavier pieces of jewelry. According to jewelers, many customers are opting for lighter-weight designs, while others are specifically requesting 18-karat gold jewelry.

Rather than focusing on the weight, people are now purchasing smaller coins or jewelry items that align with their budgets. Meanwhile, families preparing for weddings are also placing advance orders.