Gold jewellery demand is a key factor shaping the festive season in 2026. Despite recent declines in gold prices and rising inflation, several major jewellery companies have reported strong business growth and remain optimistic about the upcoming festivals and wedding season.
- Gold prices fell to ₹1.5 lakh per 10 grams in October 2026.
- Inflation rose to 5.54% in September, affecting consumer budgets.
- Prime Minister Modi urged Indians to defer gold purchases for a year.
- Jewellery companies reported 21-31% revenue growth in Q2 FY27.
- Festive and wedding seasons expected to support demand in Q3 FY27.
Why have gold prices fallen recently?
Gold prices in India dropped for the third consecutive day in mid-October 2026, falling by ₹1,800 to ₹1.5 lakh per 10 grams. This decline was influenced by a strengthening Indian rupee, which made imported bullion cheaper. Since early October, gold prices have corrected by nearly 11% from their August highs, creating volatility in the market.
How is inflation affecting gold jewellery demand?
India's retail inflation increased to 5.54% in September 2026, with food inflation rising to 7.74%. Higher living costs may make consumers more cautious about discretionary spending, including on jewellery. However, demand related to weddings is expected to remain relatively stable despite these pressures.
What impact does the Prime Minister's appeal have on gold purchases?
In May 2026, Prime Minister Narendra Modi appealed to citizens to avoid buying gold for a year to ease pressure on the rupee and foreign exchange reserves. While this appeal may influence some consumers, traditional and wedding-related gold purchases are likely to continue, making the overall impact uncertain.
How did jewellery companies perform in the September quarter (Q2 FY27)?
Several listed jewellery companies reported strong year-on-year revenue growth in Q2 FY27 despite some demand moderation late in the quarter. Titan's jewellery business grew by 21%, Kalyan Jewellers' India revenue increased by 27%, Senco Gold's total revenue rose by 31%, and PC Jeweller reported a 28% growth in consolidated revenue. These figures indicate resilient demand amid market challenges.
What is the outlook for the upcoming festive and wedding season?
Jewellery companies are optimistic about the October to December quarter, which includes major festivals like Diwali and Dhanteras, as well as the wedding season. Kalyan Jewellers and Senco Gold expect strong seasonal demand supported by wedding-related buying and a favorable festive calendar. However, the actual sales volumes will depend on gold price volatility and consumer affordability.
Frequently Asked Questions
Q: Why have gold prices fallen in October 2026?
A: Gold prices fell due to a stronger Indian rupee, which made imported bullion cheaper, and a correction from August highs, leading to increased market volatility.
Q: How does inflation affect jewellery buying?
A: Rising inflation increases living costs, which can make consumers more cautious about discretionary spending like jewellery, though wedding demand may remain steady.
Q: What was Prime Minister Modi's appeal regarding gold purchases?
A: In May 2026, he asked Indians to avoid buying gold for a year to reduce pressure on the rupee and foreign exchange reserves.
Q: Are jewellery companies optimistic about the festive season?
A: Yes, companies like Kalyan Jewellers and Senco Gold expect strong demand during festivals and weddings in the October-December quarter.
