Gold demand in India has started to pick up this week after domestic prices eased back from their recent record highs, although many buyers are still cautious. Lower prices have encouraged some purchases, but overall consumer sentiment remains guarded amid broader economic uncertainty.
Retail dealers trimmed discounts to approximately $12–$27 per ounce, down from about $35 a week earlier. That narrower discount range reflects a market adjusting to the price pullback while dealers manage inventory and margins.
Meanwhile, Chinese gold imports through Hong Kong plunged in January, reaching their lowest level since April 2022. The sharp decline points to reduced physical buying in one of the world’s largest gold markets.
India’s gold imports for February are expected to collapse by roughly 85% year‑on‑year, potentially marking a 20‑year low. Supply constraints have tightened notably as banks and institutional buyers have imported very little, if any, gold this month. The drop in shipments and cautious buying behavior are combining to limit overall physical demand.
Market participants say the combination of high global prices earlier in the year and a recent correction has left many consumers waiting for clearer signals before making larger purchases. Jewelers, who typically purchase ahead of peak seasons, are also pacing their orders amid concerns about further price volatility.
Analysts note that short‑term movements in discounts and imports can be volatile, influenced by factors such as currency fluctuations, local taxes, and seasonal demand. For now, the market appears to be in a transitional phase: prices have eased enough to prompt some renewed buying, but not enough to restore the strong demand seen before the price spike.
In summary, modest improvement in Indian gold demand has emerged alongside reduced dealer discounts and a sharp decline in Chinese imports via Hong Kong. However, projected steep falls in India’s February imports and scarce bank purchasing suggest that supply and demand will remain subdued until greater price stability returns.