NewKerala.com

Gold Investment Demand in India Surges to 42% in CY25: Report

Investment demand is reshaping India's gold consumption, with its share rising sharply to 42% in CY25 from 29% in CY24, according to a CareEdge Ratings report. The surge is led by gold ETFs and bar-and-coin buying, driven by safe-haven demand and geopolitical uncertainty. Global gold demand hit an all-time high of around 5,000 metric tonnes in CY25, up 8% year-on-year. Despite high prices, jewellery demand remained resilient in value terms, rising 10% to Rs 4.8 lakh crore, though volumes declined 15%.

Key Points: India Gold Investment Demand Rises to 42% in CY25

  • Investment demand share rises to 42% in CY25 from 29% in CY24
  • Gold ETF investments in India add 37.5 tonnes, exceeding past 10 years combined
  • Global gold demand hits record ~5,000 metric tonnes in CY25
  • Jewellery consumption share falls below 60% for first time
2 min read

Investment demand drives shift in India's gold consumption; share rises to 42% in CY25: CareEdge

Investment demand drives structural shift in India's gold consumption, rising to 42% in CY25 from 29% in CY24, led by ETFs and bar-and-coin buying: CareEdge.

"Investment demand is driving a structural shift in India's gold consumption - CareEdge Ratings"

New Delhi, April 27

Investment demand is driving a structural shift in India's gold consumption, with its share rising sharply to 42 per cent in CY25 from 29 per cent in CY24, according to a report by CareEdge Ratings.

The report said the surge in investment demand was led by gold ETFs and bar-and-coin buying, supported by safe-haven demand, portfolio diversification and geopolitical uncertainty.

It added that jewellery consumption has seen a relative decline, with its share falling below 60 per cent of total gold purchases in CY25 compared to a long-term average of around 70 per cent.

According to CareEdge Ratings, global gold demand reached an all-time high of around 5,000 metric tonnes in CY25, up about 8 per cent year-on-year, driven primarily by strong investment demand despite high prices and macroeconomic headwinds.

Global investment demand rose to 2,175 metric tonnes in CY25, surpassing the previous record of 1,805 metric tonnes in CY20, with ETF investments contributing over 800 metric tonnes, the report said.

In India, ETF investments added 37.5 tonnes in CY25, exceeding the combined investment of the past 10 years, reflecting strong investor participation.

The report noted that gold prices have entered a high-price regime supported by structural demand shifts, central bank buying and ongoing global uncertainties.

Despite high prices, jewellery demand in India remained resilient in value terms, rising about 10 per cent year-on-year to Rs 4.8 lakh crore in CY25, although volumes declined by 15 per cent due to preference for lighter and lower-carat jewellery.

CareEdge Ratings said organised jewellers are expected to benefit from the trend, with revenue growth projected at around 35 per cent year-on-year in FY26 and 20-25 per cent in FY27, supported by store expansion and market share gains from sector formalisation.

The report added that margins are expected to expand in FY26 due to inventory gains, before normalising in FY27 amid range-bound gold prices and higher operating expenses from new store additions.

- ANI

Share this article:

Reader Comments

P
Priya S
Honestly, this makes sense. Gold prices are through the roof, and who can afford heavy jewellery anymore? Even for weddings, families are opting for lighter pieces. The ETF route is smarter for long-term gains, but I miss the old days when gold was about tradition, not just investment. 💍
V
Vikram M
Great news for organised jewellers! The formalisation of the sector will hopefully bring more transparency. But I worry about small traditional jewellers losing out. Also, that 15% volume decline in jewellery is a red flag for rural demand where gold is still a store of value.
S
Siddharth J
As someone who started investing in gold ETFs last year, I can confirm this trend. The convenience of buying via apps and the liquidity is unmatched. But I hope the government keeps an eye on the price volatility—high prices are good for investors but bad for consumers who need gold for emergencies. 📈
N
Nikhil C
The global uncertainty angle is key—people are parking money in gold because of geopolitical tensions and inflation. But 42% investment share is huge! It shows we're becoming more like Western markets where gold is an asset class, not just adornment. Still, I hope jewellery demand doesn't fade completely—it's part of our culture.

We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.

Leave a Comment

Minimum 50 characters 0/50