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Diwali

Diwali Demand for Gold and Silver Surges Despite Record Prices

Strategic Insights

— 1 min read

As Diwali approaches, the record prices of gold and silver may seem like a deterrent for traditional buyers, but the bullion industry is witnessing a surge in demand, with gold and silver coins and bars facing a scarcity. The five-day festival of Diwali begins on October 18, and the industry is bracing for a record-breaking sale in terms of volume and value. Despite higher prices, the demand for gold and silver is expected to be driven by factors such as geopolitical tensions and international factors.

Key Takeaways:

  • Demand for gold and silver has outstripped supply, with a waiting period of up to one week for silver due to high demand.
  • The India Bullion and Jewellers Association (IBJA) expects a record sale in terms of volume and value during Diwali, driven by FOMO (Fear of Missing Out) among consumers and investors.
  • The sale of lightweight and low-carat jewelry is likely to pick up, as consumers opt for affordable alternatives to traditional jewelry.
  • Coins weighing 5-10gm are not available, with a long waiting period for silver due to high demand.
  • Experts attribute the surge in demand to geopolitical tensions, including the Russia-Ukraine and Israel-Palestine conflicts, as well as US tariffs on India and now China.
  • The price of 24-carat gold in Mumbai has increased from Rs 60,000 per 10gm in Diwali 2023 to Rs 1,26,000 ahead of Diwali 2025.

Statistics:

  • Record price of silver: Rs 1,75,325 per kg
  • Record price of gold: Rs 1,24,155 per 10gm (excluding making charges and GST)
  • Expected record sale in terms of volume and value during Diwali: IBJA estimates
  • Waiting period for silver: up to one week for procurers
  • Weight of coins not available: 5-10gm
  • Upward trend in gold price due to geopolitical reasons: Experts estimate

Sources:

  • Dadar goldsmith Prakash Jain: Interview
  • Surendra Mehta, National Secretary, IBJA: Interview
  • Kanaya Kakad, Joint Treasurer, IBJA: Interview
  • India Bullion and Jewellers Association (IBJA) report: Unspecified date and author
  • Times of India article, with date and author: Unspecified

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