Gold consumption decreased by 12% in the first half of 2025, prompting the World Gold Council to revise their predicted demand for gold downward for the remainder of the year.
The World Gold Council has revised down the projected annual gold demand for 2025 to between 600 and 700 tonnes, due to a 12% fall in gold consumption in the first half of the year.
In the second quarter of 2025, gold demand reached 134.9 tonnes, marking a 10% decrease compared to the same quarter last year. Despite the volume decline, the value of gold demand increased due to higher prices. In value terms, gold demand for Q2 2025 was Rs 1.21 lakh crore, a 30% increase from the same quarter last year.
The decline in gold demand can be attributed to a 17% decrease in jewellery demand to 88 tonnes and a 34% reduction in gold imports into India to 102.5 tonnes in the June quarter. On the other hand, investment demand for gold increased by 7% to 46 tonnes in the same period. Gold recycling in India remained resilient with a 1% increase to 23.1 tonnes in the June quarter.
The World Gold Council's mid-year outlook highlights modest softening in retail investment in the second half of 2025 and a slight downward revision of central bank demand reflecting a Q2 slowdown. However, the Council continues to expect strong technology sector demand and record mine production in 2025.
Overall, the demand revision to 600-700 tonnes reflects these dynamics, down from previous higher projections. The domestic price per 10 grams of gold touched INR 90,306.8 in the June quarter. Total gold demand from January to June in 2025 was approximately 253 tonnes.
This demand revision aligns with the observed volume declines, offset partially by price increases, and reflects the cautious outlook on economic growth and jewellery demand. The World Gold Council anticipates full-year gold demand in 2025 to range between 600 and 700 tonnes.
In the rapidly changing financial landscape of 2025, a strategic investor might contemplate expanding their portfolio to include both real-estate and the technology sector, as the World Gold Council anticipates strong demand in these areas, despite a projected modest decline in gold demand for the year, ranging between 600 and 700 tonnes. Concurrently, for individuals seeking to invest in the gold market, it might be advantageous to focus on the potential growth in investment demand for gold, which increased by 7% in the June quarter, despite the decline in overall gold demand.
