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Gudi Padwa jewellery sales flat; demand for gold coins surges

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 Gold prices have surged to nearly Rs 90,000 per 10 grams (excluding GST) in the physical market, leading to a noticeable decline in jewellery sales in Maharashtra/Goa during Gudi Padwa, a festival traditionally associated with gold purchases. Despite this, demand for gold coins as an investment remains strong, as consumers anticipate further price appreciation. Mumbai’s largest gold hub has observed a shift in consumer behavior toward gold coins and bars. Traders said  that buyers are purchasing gold coins with the expectation of future price increases.

As of Gudi Padwa, gold prices have reached nearly Rs 90,000 per 10 grams, making gold jewellery significantly more expensive. Higher prices have deterred traditional jewellery buyers, shifting demand towards investment-oriented purchases, such as gold coins. Industry experts anticipate that gold prices may continue to rise, reinforcing gold’s status as a long-term store of value.

Equal demand was observed between gold jewellery and investment-grade coins. Retailers introduced discounts and exchange offers, but high prices still impacted sales volume.Tier-2 cities experienced similar trends, with more gold coin buyers than jewellery shoppers. Lightweight jewellery, silver accessories, and gold-plated ornaments saw higher traction compared to heavy gold jewellery.

Global trade tensions and potential U.S. Fed rate cuts are boosting gold’s attractiveness as an investment. Investors are shifting towards gold due to its historical role as a hedge against inflation and economic instability The Indian Rupee’s performance against the U.S. Dollar is also a contributing factor to local gold price fluctuations.

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National News

GJC Engages With RBI, Ministry of Finance on Gold Monetization Scheme Revamp

The proposed Model is Designed to Address Existing Structural Inefficiencies and Significantly Enhance the Scheme’s Adoption

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GJC has been actively engaging with senior officials of the Reserve Bank of India (RBI) and the Ministry of Finance (MoF) to advance a comprehensive revamp of the Gold Monetisation Scheme (GMS).

GJC has submitted a refined, jeweller-integrated framework for GMS, developed through structured stakeholder consultations across the banking, refining, and jewellery sectors. The proposed model is designed to address existing structural inefficiencies and significantly enhance the scheme’s adoption and effectiveness.

The proposed GMS operates within the existing regulatory framework notified by the RBI and the Government of India, ensuring full compliance, institutional oversight, and financial system integrity. The framework builds on the current scheme architecture while introducing operational efficiencies and stakeholder alignment.

A central feature of the proposal is the formal transition towards a digital gold ecosystem, whereby physical gold is converted into dematerialised gold balances held within the banking system through structured account mechanisms.

In recent years, investment demand in gold bullion and coins has witnessed strong and sustained growth, reflecting increasing investor preference for physical gold as a store of value. The revamped GMS framework seeks to effectively leverage this trend by enabling investors to seamlessly monetise such holdings.

The scheme provides an avenue for investors to earn a return on idle gold assets, including bullion, coins, and jewellery, by integrating them into the formal financial system. This converts traditionally non-yielding assets into interest-bearing financial instruments, thereby enhancing portfolio efficiency without requiring liquidation of gold holdings.

The revised framework is anchored on robust governance principles:

Transparency: End-to-end digital recording of transactions, including deposit, assay, dematerialisation, and credit.

Traceability: System-based tracking of gold across the value chain, supported by verifiable documentation and audit trails.

Accountability: Clearly defined responsibilities for all participants, reinforced through KYC compliance, documented consent, and regulatory supervision.

This structure ensures a secure, compliant, and auditable gold monetisation ecosystem, addressing key concerns under the existing scheme.

The proposed framework is expected to materially improve gold mobilisation by leveraging the reach and trust of the jewellery trade. Enhanced mobilisation of idle gold can reduce dependence on imports, support domestic supply, and contribute to the moderation of the Current Account Deficit (CAD).

Further, the shift towards a regulated digital gold framework will strengthen formalisation, improve compliance standards, and enhance overall market efficiency.

Rajesh Rokde, Chairman of GJC, said,

“GJC’s continued engagement with the Reserve Bank of India and the Ministry of Finance reflects our commitment to building a robust and future-ready Gold Monetisation framework. The proposed model integrates jewellers into a regulated, digital ecosystem, significantly enhancing transparency, trust, and accessibility for consumers. By unlocking the value of idle gold, the scheme has the potential to strengthen domestic supply, reduce reliance on imports, and contribute meaningfully to India’s macroeconomic stability.”

Avinash Gupta, Vice Chairman of GJC, said,

“The revamped GMS framework is designed to be practical, scalable, and fully aligned with regulatory expectations. It creates a secure and transparent pathway for gold monetisation, while ensuring accountability across all stakeholders. Importantly, it enables investors to earn returns on idle gold—including bullion, coins, and jewellery—thereby transforming a traditionally non-yielding asset into a productive financial instrument. This will play a critical role in formalising the sector and improving overall market efficiency.”

The trade is encouraged to support this initiative, which represents a significant step towards a regulated, transparent, and digitally integrated gold ecosystem in India, while unlocking value from idle gold holdings.

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