India gold market shows signs of recovery

The Indian gold market is showing signs of recovery following a period of significant headwinds. After a sharp price correction in June, domestic gold prices stabilized in July and began recovering in early August. In rupee terms, gold prices gained approximately 7 percent during the first two weeks of August.

According to the World Gold Council, factors such as shifting monetary policy expectations, a weaker U.S. dollar, and renewed inflows into gold ETFs have supported these prices. While international gold prices rose by about 9 percent in the same period, the strength of the rupee partially offset these gains domestically.

Gold imports into India doubled in July, rising from 20 tonnes in June to an estimated 40-45 tonnes. This increase signals strengthening demand. The jewelry market has also seen improvement; industry feedback indicates that deferred purchases are returning to the market, leading to higher footfall and increased order flows for manufacturers as jewelers replenish inventory ahead of the festive season.