As Diwali 2025 unfolded in Sacramento, the city’s Indian community gathered to celebrate the festival of lights with all the warmth and tradition one would expect. Families cooked sweets, exchanged blessings, and offered prayers for prosperity—a scene that felt timeless. Yet, beneath the glow of diyas and the aroma of festive treats, a new kind of uncertainty lingered in the air, one shaped by global economic tremors and the capriciousness of gold prices.
“Everyone is like a family here. Food is a big part of our celebration. We love to cook a lot of sweets,” said Shrdha Shah from BAPS Sacramento, capturing the resilient spirit of the community. But this year, the celebrations came with an undercurrent of economic anxiety. Local businesses, especially those with ties to India, braced for the impact of newly imposed tariffs that threatened to upend their bottom lines.
Sean Dutt, owner of Pizza Twist on Sacramento’s K Street, found himself at the crossroads of tradition and trade. His restaurant, known for its Indian fusion pizza, relies heavily on sauces imported from India—a supply chain now complicated by a 25% tariff implemented by the Trump administration. “This is some of the stuff that comes from India,” Dutt explained to KCRA 3, gesturing to the imported ingredients that have become costlier. The squeeze is twofold: not only has the U.S. raised tariffs, but India has responded in kind, imposing nearly 50% taxes on certain goods.
“There’s nothing I can do, you just got to go with it, just pray. Pray for a change, everybody’s trying to survive,” Dutt said, his words echoing the uncertainty many small business owners feel. For now, some shops are weathering the storm by relying on existing inventory. “We haven’t really seen that big impact right now because maybe some of the shops are still using the stocks that they have already,” noted Selvi Jana, president of the Indian Association of Sacramento. But the writing is on the wall: “It is definitely impacting our lives.”
As the festival continued, the Indian Association of Sacramento took on the task of preparing its community for what could be a tough road ahead. The mood was somber but determined. “Times tough are right now when you see restaurants closing every day, just hanging in there hoping for change,” Dutt admitted. The juxtaposition of celebration and caution was palpable, a reminder that even the most joyous traditions can’t fully insulate a community from broader economic trends.
While Sacramento’s Indian community faced these local economic headwinds, the global stage was witnessing its own drama—one that would ripple through markets and households alike. Gold, long considered a safe haven and a staple of Diwali gifting, experienced a wild rollercoaster in the week leading up to the festival. According to Market Minute, gold prices had been on a record-breaking bull run throughout 2025, soaring past $4,000 per ounce globally and reaching an astonishing ₹132,294 per 10 grams on India’s Multi Commodity Exchange by early October.
But just days before Diwali, the yellow metal took its “deepest losses” on record. On October 17 and 18, MCX gold December futures dropped 2% to ₹127,320 per 10 grams, and US gold futures fell over 2% to $4,213.30 per troy ounce. The cause? A mix of profit-taking after unsustainable highs, a strengthening US dollar, and a perceived easing of US-China trade tensions following comments from President Donald Trump regarding tariffs. The sudden correction sent jitters through the market, with investors and consumers alike questioning whether gold’s meteoric ascent was sustainable.
Yet, in a twist befitting the festival of lights, gold staged a remarkable comeback as Diwali week began. On October 20, spot gold rebounded to between $4,253.33 and $4,259.84 per ounce, while US gold futures for December delivery climbed 1.3% to 1.5%, reaching up to $4,275 per ounce. This “strong comeback,” as described by Market Minute, was driven by renewed investor interest and, crucially, by robust festive demand from India. The cultural significance of gold during Diwali, when millions rush to buy coins and jewelry, provided a vital floor for prices and demonstrated the unique interplay between tradition and economics.
The volatility didn’t just make headlines; it reshaped fortunes across the financial and retail sectors. Gold mining giants like Newmont Corporation and Barrick Gold Corporation saw their profits whipsaw with the price swings. As Market Minute explained, “Companies with efficient operations and lower ‘all-in sustaining costs’ (AISC) stand to benefit immensely” from such rebounds, while smaller-cap producers like McEwen Mining Inc. felt the effects even more acutely—both good and bad.
For jewelers, the stakes were equally high. Inventory acquired at lower prices turned into a windfall for those agile enough to capitalize on the rebound, especially during Diwali’s surge in demand. In India, Titan Company Ltd. faced the dual challenge of managing costs and consumer behavior, while global players like Signet Jewelers Limited and Chow Tai Fook Jewellery Group Limited had to adjust pricing and inventory strategies on the fly. Gold-backed ETFs such as SPDR Gold Shares and iShares Gold Trust mirrored the market’s volatility, with their Net Asset Values declining and then recovering in tandem with the metal’s fortunes.
Beyond the immediate winners and losers, gold’s dramatic week underscored its enduring role as a barometer of global uncertainty. Persistent geopolitical tensions—including renewed US-China trade friction and fears of a US government shutdown—continued to drive demand for safe-haven assets. The expectation of US Federal Reserve rate cuts and ongoing inflation concerns only added fuel to the fire, reinforcing gold’s appeal as a hedge against currency debasement and economic instability.
The Diwali rebound also highlighted the cultural dimension of gold demand. In India, where gold is woven into the very fabric of festival celebrations, the plunge in prices triggered a surge in physical buying, preventing a deeper correction. This “buy the dip” mentality, rooted as much in tradition as in market logic, provided a stark contrast to the more speculative trading seen in Western markets.
Looking ahead, analysts suggest the gold market is likely to remain volatile in the short term as investors digest recent swings and search for a new equilibrium. Persistent inflation, shifting interest rate expectations, and ongoing geopolitical uncertainties will continue to shape gold’s trajectory. For now, the swift rebound during Diwali serves as a powerful reminder of the metal’s resilience and the deep connections between global markets and local traditions.
For Sacramento’s Indian community, the message is clear: while economic headwinds and market volatility may cast a shadow, the enduring strength of tradition and community spirit offers its own kind of safe haven. And in the world of gold, as on the streets of Sacramento, resilience is the name of the game.
