Silver Rises Over 120% YTD 
Gold jewelry demand in India has fallen significantly since January, with the weakness continuing into February. Meanwhile investment interest remains robust through bars, coins, and ETFs, which saw record inflows in January.
The Reserve Bank of India has returned to gold buying, adding 2.8 tonnes to its reserves after a December pause. The market is seeing structural changes in consumer behavior, with many buyers choosing to exchange old gold for new jewelry or sell existing holdings to lock in profits.
This shift has created challenges for retailers, leading to a liquidity crunch in the industry and causing domestic gold prices to trade at increasing discounts to international prices – widening from US$3/oz in December to US$23/oz. Looking ahead, while high prices and year-end financial commitments may continue to pressure jewelry demand, the start of the new fiscal year in April could bring some relief, especially if prices stabilize.
