The Indian gold market in early 2026 is characterized by a resilient recovery following a volatile March. After gold prices experienced their weakest monthly performance in over a decade—dropping 12% in USD and 8% in INR—prices partially stabilized in April. This recovery is supported by persistent geopolitical risks and a softening US dollar, though prices remain 13% below the January peak.

Demand Dynamics & Retail Performance

Despite price volatility, listed jewellers reported a stellar Q1 2026, with revenue growth between 32% and 124% y/y. This surge was fueled by a robust wedding season, higher average ticket sizes, and aggressive store expansions. While retail jewellery demand was muted in early March due to price spikes, interest shifted toward investment products like bars and coins. Interestingly, “old gold” exchanges accounted for nearly 50% of retail sales, highlighting consumer sensitivity to high prices.

Investment Trends

• Gold ETFs: India saw its 11th consecutive month of inflows in March (INR 22.7bn), despite high redemptions from profit-taking. Q1 2026 marked the strongest quarterly inflow on record, bringing total holdings to 115 tonnes.
• Digital Gold: Purchases via UPI remain well above historical averages, with February volumes hitting 1.9 tonnes (53% above the 13-month average), signalling a growing retail preference for accessible digital assets.

Supply & Central Bank Reserves

Domestic supply tightened significantly in April as gold discounts narrowed from US8/oz. This shift was driven by new import curbs on gold-bearing alloys and customs bottlenecks. Consequently, March imports hit a nine-month low (approx. 20–25t). Meanwhile, the Reserve Bank of India (RBI) maintained steady reserves, holding 880.5 tonnes of gold, which now constitutes 17% of total forex reserves.

Outlook: Market sentiment remains optimistic for the upcoming summer wedding season and festivals like Akshaya Tritiya, with price stability expected to release pent-up consumer demand.