Gold under pressure globally; Indian households rush to make profits

Gold prices touched record highs earlier this year before witnessing a sharp correction in recent weeks. Many consumers now believe prices may have peaked and could decline further. With gold recently trading around Rs 1.4 lakh per 10 grams and market expectations that prices could retreat to around Rs 1.2 lakh, households are choosing to monetise old jewellery rather than hold on to it.

With gold trading around Rs 1,44,199 per 10 grams last week, well below its all-time high, Indian consumers are increasingly selling old jewellery instead of exchanging it for new ornaments. The fear is simple: if gold prices fall further, they may get less value for their jewellery. According to the India Bullion & Jewellers Association (IBJA), Indian households sold nearly 50 tonnes of old gold during the April-June quarter, a 43% jump from a year ago, as many rushed to book profits.

The selling trend comes as gold prices remain under pressure in international markets. Higher interest rates generally reduce the appeal of gold because the metal does not offer any fixed returns, prompting investors to move towards interest-bearing assets.