Today : Feb 23, 2025
Business
23 February 2025

Gold Prices Dip As Demand Weakens Across India

Despite falling rates, buyers face uncertainty due to upcoming festive season pressures.

The Indian market for gold and silver experienced notable fluctuations as of February 22, 2025, with gold prices witnessing declines across major urban centers. On this Saturday, 24-carat gold prices dipped to approximately ₹87,700, whereas 22-carat gold was quoted around ₹80,200. This decrease represented a drop of about ₹700, according to reports from the Indian Bullion and Jewellers Association (IBJA).

The market sentiment has been influenced by several factors, primarily stemming from weakened domestic demand coupled with profit-booking activities. Sellers, including local jewelers and stockists, have noticed reduced interest from buyers, particularly as the festive season approaches, which traditionally boosts gold purchases.

Indian jewelers have attributed the recent price drop to weak global cues as well. Reports indicate cautious economic outlooks alongside stringent monetary policies enacted by the U.S. Federal Reserve, which have collectively impacted investor sentiments and, accordingly, commodity prices. The steady rise prior to this decline raised concerns among merchants, as many began cashing out their investments.

Breaking down city-specific prices, Delhi reported 24-carat gold at ₹87,540 and 22-carat at ₹80,290 per 10 grams. Coincidentally, similar prices were seen in Mumbai, with 24-carat gold trading at ₹87,740 and 22-carat at ₹80,240. Meanwhile, Chennai displayed slightly lower values due to regional demand adjustments.

For silver, prices dropped by ₹100 to settle at ₹96,540 per kilogram on February 22, reflecting similar trending behaviors among investors. Analysts have described the current circumstances as troubling for consumers who are considering purchasing precious metals, particularly with the wedding season approaching where demand for gold typically spikes.

Experts note it might be prudent to monitor current market trends when contemplating gold purchases. Ajay Kedia, director of Kedia Advisory, warned potential investors of inflationary trends possibly pushing gold prices to historically high levels, indicating, “Gold may eclipse ₹90,000 per 10 grams later this year.” Purchasers are advised to avoid rushing amid these fluctuations, with strategic foresight potentially benefiting new investors.

The increased volatility has left buyers grappling with choices; with wedding and festive demands looming, many may find themselves purchasing at elevated rates. Analysts suggest weighing the timing of purchases carefully, as slight corrections could allow for more advantageous acquisition points.

To succinctly summarize the situation: fluctuated demand and profit realization have dictated recent price movements for gold and silver, as market players find it challenging to navigate these changes. Advices from goldsmiths and jewelers suggest pursuing certified purchases to combat risks associated with quality and pricing. The Bureau of Indian Standards (BIS) hallmark is highlighted as part of these suggestions to guarantee quality purchases, emphasizing the importance of conducting due diligence before concluding transactions.

With economic indicators fluctuative on global fronts and domestic markets positioning themselves for upcoming high-demand seasons, all eyes will be on how these elements harmonize moving forward. For those eager to invest or purchase jewelry, it may be wise to remain vigilant and consult with market professionals regularly as prices continue to dance up and down.