Full Breakdown
Dhanteras 2025: Navigating Gold's Record Prices Amid Cultural Traditions
10/18/2025, 10:55:00 PM
Festive Demand Amid Soaring Prices
As Dhanteras 2025 approaches, the jewellery market in Delhi's Lajpat Nagar is bustling with shoppers eager to purchase gold and silver, despite record-high prices. Gold prices have surged approximately 63% over the past year, reaching around INR1,34,800 per 10 grams, while silver is priced at INR1,77,000 per kilogram. Retailers report increased foot traffic, driven by a fear of missing out on potential price hikes, as noted by Prakash Pahlajani, owner of Kumar Jewels. Many consumers are opting to buy smaller quantities, with jewellers adapting by creating lighter, more affordable designs.
Shifting Consumer Preferences
A significant trend this year is the shift from traditional gold jewellery purchases to investment-driven buying. According to the World Gold Council, the share of gold jewellery in overall demand has decreased from 80% to 64%, while investment demand has risen from 19% to 35%. This change is partly attributed to the growing popularity of exchange-traded funds (ETFs) and digital gold, which saw record inflows in September. Younger buyers are particularly drawn to lighter, everyday jewellery, reflecting a broader change in consumer behavior.
Economic Factors Influencing Demand
The Reserve Bank of India (RBI) has also played a crucial role in shaping gold demand by increasing its gold reserves, which rose from 9% to 14% of its foreign exchange reserves. This strategic accumulation is aimed at diversifying holdings and reducing dependence on the dollar, further influencing market dynamics. Despite the high prices, experts predict that retail demand for gold and silver will remain robust during the festive and wedding seasons, although lower-income families may find it challenging to participate fully.
Criticism and Economic Concerns
Critics, including political figures like Akhilesh Yadav, have pointed out that rising gold prices reflect broader economic issues, such as inflation and unemployment, which are impacting consumer purchasing power. Some families, like Bhavna, preparing for weddings, are reconsidering their purchases due to high costs, expressing a desire to wait for prices to drop before completing their shopping.
Official Statements & Responses
Experts from the All India Gem and Jewellery Domestic Council (GJC) have indicated that while volume sales may decline by 12-15% due to high prices, value sales are expected to increase by 20-25%. Rajesh Rokde, GJC Chairman, emphasized that the affluent classes will continue to buy, although it may be a setback for lower-income families. The GJC's "Lucky Lakshmi Jewellery Sales Festival" aims to boost sales through promotions and digital campaigns, particularly targeting younger consumers.
Verbatim Quotes
- “We’re seeing a wave of smart, purposeful buying this Dhanteras,” — Rajesh Rokde, Chairman of GJC
- “Despite gold prices reaching multiple historic highs through 2025, witnessing an approximate 51.2 per cent year-to-date increase in rupee prices by end-September, consumer sentiment and demand for the yellow metal have been positive,” — Sachin Jain, World Gold Council
- “People are suffering the brunt of inflation. Prices of gold and essentials are soaring, unemployment is rampant, and our economy has become dependent on China.” — Akhilesh Yadav, SP Chief
- “I am now having to think a lot while buying - about whether to even get something,” — Bhavna, prospective bride
Conclusion: Cultural Significance and Future Outlook
Despite the challenges posed by high prices, the cultural significance of gold in India ensures that demand will persist. With Indian households holding approximately $3.8 trillion in gold, the long-term outlook remains positive. As the festive season unfolds, the interplay between tradition and modern investment strategies will continue to shape the gold market in India.
