Gold Prices May Fall This Diwali as Diamonds Gain Popularity in India

Indian consumers are rethinking their jewellery purchases this Diwali as rising gold prices increase shopping costs. Gold prices have climbed around 54% compared with the 2025 festive season, pushing many buyers to explore affordable alternatives. Consumers are choosing lighter necklaces, lower-carat gold and smaller diamond jewellery pieces to manage their budgets. This shift reflects changing preferences as shoppers balance festive traditions with rising expenses. Diamonds are gaining attention as buyers look for attractive jewellery options at more accessible prices.

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Rising Gold Prices Change Festive Shopping Trends

The sharp increase in gold prices has encouraged consumers to reconsider how much gold they purchase this festive season. Instead of investing in heavy jewellery, many buyers are choosing lighter designs and lower-carat options. These alternatives allow shoppers to maintain their festive purchases without spending as much as they would on traditional gold jewellery. Retailers are observing a growing interest in affordable and lightweight ornaments. The trend highlights how changing prices are influencing jewellery-buying decisions across India.

While gold prices have risen, small diamond prices have reportedly fallen by approximately 25%, making diamond jewellery more accessible to buyers. This price difference has encouraged consumers to consider diamond pieces as an alternative to expensive gold ornaments. Retailers expect diamond jewellery sales to increase by 15% to 20% during the festive season. Everyday jewellery priced between ₹30,000 and ₹1 lakh is attracting particular interest. Smaller diamond pieces are emerging as an appealing choice for shoppers seeking stylish jewellery within a defined budget.

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Gold Spending Reaches a Record High

Jewellery retailers are adapting their offerings to match these changing consumer preferences. Lightweight diamond earrings, pendants and other everyday pieces can appeal to buyers who want versatile designs without making a large investment. The expected rise in diamond jewellery sales also reflects the growing importance of affordability in festive shopping decisions. However, individual purchasing choices will continue to depend on design preferences, budgets and local market conditions. The festive season could provide retailers with an opportunity to attract customers who might otherwise postpone jewellery purchases.

Data from the World Gold Council highlights the financial pressure created by rising gold prices. Indian consumers purchased less gold but spent more money, pushing the total gold bill to a record ₹1.98 lakh crore, according to the figures cited in the report. This trend shows how higher prices can increase overall spending even when purchase volumes decline. As Diwali approaches, consumers are weighing gold against alternatives such as diamond jewellery. The market’s performance will reveal how effectively jewellers respond to changing budgets and festive demand.

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