Gold demand in India strengthened Friday as the Dhanteras festival coincided with a significant retreat in bullion prices, attracting buyers back to jewelry stores and precious-metal dealers.
Local gold prices traded around 141,800 rupees per 10 grams after touching 137,863 rupees earlier in the week, their lowest level since March 24.
Prices remained substantially below the year’s record of 180,779 rupees per 10 grams.
The India Bullion and Jewellers Association expected Dhanteras sales to increase approximately 10% from the previous year, reflecting improved buying interest following the price decline.
India is one of the world’s largest gold-consuming markets, and festival-related purchases can influence physical bullion demand and import activity.
However, the recovery has not been uniform.
Rural demand remained constrained by weaker agricultural conditions and reduced household purchasing power. Drought conditions and poor monsoon rainfall have weighed on farm incomes in several areas.
Retail buyers also continued showing interest in gold coins and bars, alongside traditional jewelry purchases.
Stronger physical demand could provide some support to international gold markets, although increased imports may also affect India’s trade balance and currency demand.
The next indicators will be actual festival sales, bullion import volumes and whether buying interest persists after the seasonal demand period.
