Gold Investment Demand Beats Jewellery Consumption In India For First Time Ever

India’s gold investment demand surpassed gold jewellery consumption in the quarter ended March 2026 for the first time ever, according to figures published by the World Gold Council (WGC). The shift was driven by strong investor interest in gold amid rising prices and weaker returns from domestic equity markets.

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The WGC said gold investment demand in India increased 52% year-on-year to 82 metric tonnes during the quarter. In comparison, jewellery demand fell 19.5% to 66 metric tonnes.

Total Gold Demand Remains Strong

Despite the decline in jewellery purchases, India’s overall gold consumption rose 10.2% year-on-year to 151 metric tonnes in the March quarter, according to the report.

Investment demand accounted for 54.3% of total gold consumption during the quarter, marking the first time it exceeded jewellery demand in the country.

Traditionally, jewellery purchases have remained the largest contributor to India’s gold consumption, while investment demand typically accounts for nearly one-fourth of overall demand.

ETF Inflows Rise Sharply

The World Gold Council said inflows into gold exchange-traded funds (ETFs) increased 186% year-on-year during the March quarter to a record 20 metric tonnes.

Higher gold prices and volatility in equity markets contributed to increased investor participation in gold-backed financial products.

Since the start of 2025, gold prices in India have almost doubled, while the Nifty 50 index, which is the main index for the stock market, has only gone up about 2.4%.

The WGC said investors continued to increase purchases of gold coins, bars, and ETFs as gold remained a preferred safe-haven asset amid market uncertainty.

Equity Market Weakness Drives Demand

As per the WGC, the underperformance of equity markets was among the reasons behind the increased allocation of investments in gold by investors.

Increased global uncertainties associated with geopolitical instabilities and volatility in financial markets also characterized the quarter of March, thus leading to an increase in demand for precious metals. India ranks second in terms of gold consumption, next only to China in the world.

The World Gold Council said investment-led gold demand is expected to remain an important component of overall consumption trends in the coming quarters as investors continue to diversify holdings toward gold-backed assets.