Diwali Gold Investment : Buying gold during Dussehra, Diwali and the wedding season has long been considered auspicious in India. However, high prices are changing how consumers approach their purchases this year. Many families are maintaining similar budgets but opting for lighter jewellery, while others are considering gold coins, bars and gold exchange-traded funds (ETFs). Following a decline from record levels, buyers are assessing whether the current prices offer an opportunity or whether gold could become cheaper still.

Global Markets Influence Gold Prices
Gold prices recorded a modest increase in international markets on Tuesday, supported partly by a weaker US dollar. Spot gold rose 0.1% to $4,145.22 per ounce, while US gold futures for December delivery reached $4,164.70 per ounce. This recovery followed a decline of more than 26% from the record level reached in January 2026. Investors are closely watching the US Federal Reserve's policy meeting scheduled for October 27–28, as its decisions and guidance on interest rates could influence gold prices.

Growing Interest in ETFs and Digital Gold
Alongside traditional gold purchases, digital investment options are attracting attention. According to the available figures, gold ETFs received net inflows of Rs 2,596.70 crore in August, exceeding the Rs 1,559 crore recorded in July. This marked the third consecutive month of positive inflows. Gold holdings under these funds were reported at 121.3 tonnes, with assets under management reaching approximately Rs 1.91 lakh crore. Digital gold purchases averaged Rs 2,500 crore per month between June and August. In contrast, India's gold imports fell to $2.3 billion in August, down 45% from July.

Consumers Focus on Lighter Jewellery
Experts say high gold prices are encouraging families to rethink their purchases. At the beginning of the festive season, 24-carat gold was trading at around Rs 1.48 lakh per 10 grams. Consequently, many consumers are choosing lighter jewellery without significantly increasing their budgets. Coins, bars and ETFs are also receiving greater consideration as investment options. Experts believe that Indians' traditional attachment to gold remains strong, but wealth preservation is becoming an increasingly important factor alongside jewellery purchases.

Could Gold Prices Rise by Diwali?
Whether gold prices rise by Diwali will depend on several domestic and international factors. Festive and wedding demand in India could provide support to domestic prices. Meanwhile, US Federal Reserve policy, inflation data, movements in the dollar and government bond yields will influence international markets. Experts suggest that central bank purchases could support gold over the longer term, although selling by other investors may limit gains. Softer crude oil prices and declining bond yields could favour gold, while tighter monetary policy may put pressure on prices. Therefore, the recent decline should not automatically be interpreted as a guarantee of a sustained recovery.