In H1 2026, domestic raw gold production was 152.908 mt, down 26.175 mt YoY, a decline of 14.62%; imported raw gold production was 77.080 mt, up 3.402 mt YoY, an increase of 4.62%. Total gold production from domestic and imported raw materials was 229.988 mt, down 22.773 mt YoY, a decline of 9.01%. Meanwhile, China's gold consumption totaled 511.412 mt, up 1.23% YoY. This comprised gold jewelry (132.133 mt, down 33.88% YoY), gold bars and coins (339.336 mt, up 28.42% YoY), and industrial and other uses (39.943 mt, down 2.90% YoY).

Jun 05, 2026, 02:40 AM Import duty hike and volatile prices keep Indian gold demand subdued. China premiums narrow as cautious sentiment weighs on physical buying. Analysts warn smuggling risk rises as domestic discounts widen sharply. India’s gold demand remains subdued as buyers stay cautious amid volatile prices and higher import duties, with premiums narrowing in China as well. Analysts warn that regulatory tightening and inflation risks could keep consumption weak through 2026. Domestic gold prices were trading around INR 158,400 per 10 grams on Friday. India is one of the largest consumers of gold in the world. Subdued demand in India Indian gold demand has slowed, with buyers hesitant due to volatile prices and elevated import duties, according to a Reuters report . Traders said consumers are reluctant to commit to purchases, particularly after the government raised the import duty to 15% in May, the steepest increase on record. “Demand is very weak. People are waiting for prices to stabilize,” one Mumbai-based dealer told Reuters. The World Gold Council (WGC) noted in its May update that jewellery and bar-and-coin demand could decline by 50–60 tonnes (10% year-on-year) in 2026 due to the duty hike. Domestic prices are trading at a deep discount to landed prices, widening from about $14/oz before the hike to nearly $150/oz afterwards, as ample supply and profit-taking weighed on premiums. Regulatory tightening and market impact The duty hike was part of broader measures aimed at conserving foreign exchange reserves amid geopolitical uncertainty and a weakening rupee. Banks paused bullion imports for over a month earlier this year due to delays in government notifications, further disrupting supply. Large chain jewellers reported panic buying immediately after the duty announcement but expect slower sales ahead. Smaller retailers, already pressured by high prices, are struggling with reduced volumes and margins. China premiums narrow The premiums in China, the world’s top consumer, have narrowed, reflecting cautious sentiment. Buyers are hesitant as global prices remain volatile, and local demand has softened. This trend mirrors India’s slowdown, suggesting broader regional weakness in physical gold consumption. The WGC’s May commentary noted that gold fell 1% in May, finishing at $4,546/oz, as positive risk sentiment and ETF outflows weighed on prices. Analysts warned that the Federal Reserve may need to hike rates later this year as inflation pressures mount, which could prolong headwinds for gold. “Gold is vulnerable, perched on its 200-day moving average, in what looks like a declining channel,” the WGC said. Smuggling concerns and outlook Past trends suggest that higher import duties increase unofficial inflows. After the 2013 duty hike, smuggled gold rose sevenfold within a year. A similar pattern was seen after the 2022 hike to 15%, when unofficial imports surged from 17 tonnes to nearly 50 tonnes. Analysts caution that the latest increase could again encourage smuggling, widening the domestic–international price gap. India’s gold demand is expected to remain muted in the near term, with jewellery purchases subdued outside of weddings and festivals. Investment demand is more sensitive to duty changes and could decline further if inflation persists. Globally, ETF flows remain lacklustre, and the possibility of Fed rate hikes poses additional risks. For now, the market is caught between regulatory tightening, volatile prices, and cautious consumers. Unless prices stabilize and policy pressures ease, India’s gold demand is likely to stay weak through the rest of 2026, with broader implications for global bullion trade. Source： https://invezz.com/news/2026/06/05/india-gold-demand-weakens-as-soaring-prices-keep-buyers-on-the-sidelines/

Feb 6 (Reuters) - Gold premiums in India more than halved from decadal highs this week as price volatility deterred buyers, while a pullback from record prices lifted demand in China ahead of the Lunar New Year.

Nitesh Shah, Head of Commodities and Macroeconomic Research at WisdomTree, assesses gold’s strongest year since 1979 and considers whether the metal is entering a new structural regime. He highlights trade fragmentation, rising debt, fiscal dominance and growing institutional demand as key drivers, while outlining scenarios that could see gold remain elevated or push to new highs in 2026.

【SMM News Flash】As the world's second-largest gold market, India's investment demand in Q3 was up 20% YoY to 91.6 mt, surging 67% in value terms to $10.2 billion. However, due to record-high gold prices, jewelry demand fell 31% YoY to 117.7 mt, leading to an overall 16% YoY decline in gold consumption to 209.4 mt. World Gold Council data shows that in the first nine months of 2025, investment demand accounted for 40% of total gold consumption, the highest proportion on record.Jain stated that, supported by festive and wedding season purchases, the World Gold Council expects Q4 demand to exceed Q3. However, he added that total physical gold demand in 2025 is forecast to be between 600 and 700 mt, the lowest level since 2020, significantly below last year's level of 802.8 mt.

According to the latest statistics from the China Gold Association, domestic raw material gold production in the first three quarters of 2025 totaled 271.782 mt, an increase of 3.714 mt compared with the same period in 2024, up 1.39% YoY. Additionally, imported raw material gold production amounted to 121.149 mt, up 8.94% YoY. Total gold production from domestic and imported raw materials reached 392.931 mt, up 3.60% YoY.