Taxation changes, customs duty hikes and global geopolitical tensions will be the defining factors of bullion prices in H2 2026, as prices are expected to remain volatile with possible consolidation after recent corrections, a report said on Thursday.
Jewellery demand is expected to remain subdued, though the festive season could revive sales, particularly in lightweight categories, the report from All India Gem & Jewellery Domestic Council (GJC) said.
The industry awaits clarity on reforms to the Gold Monetisation Scheme and potential tax adjustments, while geopolitical risks remain a key factor that could trigger renewed safe-haven demand, it added.
The report noted that the first six months of the year were marked by historic peaks in bullion prices, followed by corrections that reshaped consumer sentiment and industry outlook.
Gold prices peaked at Rs 1,70,480 per 10 grams in January 2026 before correcting to about Rs 1,42,800 per 10 grams by late June, while silver crossed Rs 4,02,490 per kilogram in January and eased to roughly Rs 2,25,940 per kilogram by late June.
The report added that these fluctuations pushed investors toward safe‑haven buying, but jewellery demand softened due to affordability pressures.
The Council observed that customers are increasingly turning toward lightweight jewellery designs, reflecting both budgetary considerations and changing fashion sensibilities.
The council noted that a customs duty increase announced in May 2026 pushed domestic prices higher and weighed on retail demand. GST burden and compliance requirements continued to challenge margins, prompting calls for rationalisation.
The council also reiterated its advocacy for reforms in the Gold Monetisation Scheme to unlock the value of idle household gold, reduce import dependency, and strengthen domestic supply chains.
“Looking ahead, the upcoming festive season and the peak wedding calendar in the second half of the year are expected to provide strong support to jewellery demand, particularly in lightweight categories,” said Rajesh Rokde, Chairman of GJC.
These cultural drivers, combined with India’s deep emotional connection with gold, will ensure that despite volatility, the market remains resilient, he added.
He said the market is adjusting after extraordinary highs and that retail prices have remained elevated even as futures corrected.
These shifts are driven by profit taking, a stronger US dollar index, and expectations of prolonged high interest rates globally, he said, adding global sentiment has also shifted as safe haven demand eased after recent geopolitical panic cooled.
