Gold Demand Trends: Q2 2026

Global jewellery demand remained under pressure in Q2, falling to 278t as elevated prices continued to constrain affordability, and encouraged consumers to reduce purchase weights. The weakness was broad-based, with China and India again accounting for much of the decline.

But the quarter also reinforced the split between volume and value: consumers bought less gold in fine-weight terms, but spending remained far more resilient.

That divergence was even more striking across H1. The global value of jewellery demand rose to US$86bn in H1'26, up 22% y/y from US$71bn in H1'25, despite weaker tonnage demand. This points to a market in which high prices are suppressing volumes but consumer expenditure remains strong, particularly where gold jewellery retains a strong saving, gifting or wealth-preservation role.

Consumers continue to adapt to the price environment. Lightweight products gained share across many markets, while lower-carat designs expanded in parts of Asia. Old-for-new exchange also remained important, particularly in China and India, allowing consumers to manage affordability while maintaining exposure to gold jewellery. The growing appeal of gold investment products also remained a headwind for jewellery volumes, particularly where lower premiums – and in some cases more favourable tax treatment – made bars and coins more attractive.

China

Chinese gold jewellery demand weakened further in Q2, falling 28% y/y to its lowest second-quarter level since 2004. The decline was partly seasonal, with Q2 typically a quieter period for jewellery buying, but it also reflected the same pressures that weighed on the market earlier in the year: fragile consumer confidence and the deterrent effect of elevated, volatile gold prices.

Demand for the first half year was 30% lower y/y at 136t, but the picture was notably more positive in value terms.

Consumers continued to spend big on gold jewellery despite buying less in fine-weight terms: H1 spending was up 11% at US$21bn. This underscores the continued appeal of gold jewellery in China, even as high prices push consumers towards lighter-weight products.

Affordability remained a key constraint. Many consumers either delayed purchases or exchanged old jewellery for new; investment-minded buyers continued to favour lower-premium bars or coins over jewellery, helped by the preferential VAT treatment of investment products. This added to the pressure on fresh jewellery demand and reinforced the shift from heavier, more conventional items.

Market polarisation deepened in Q2: lightweight Hard Pure Gold products continued to outperform, supported by affordability and design innovation. Competition also intensified in the high-end premium heritage segment as new brands targeted affluent consumers.

Looking ahead, seasonal factors should offer some support in H2, including wedding demand and holiday spending. But any recovery is likely to remain constrained by a cautious consumer mindset, particularly if the gold price remains elevated. Demand for lightweight, innovative and higher-value products should remain relatively resilient.

India

Indian jewellery demand fell 15% y/y to 75t in Q2, the lowest second quarter since the pandemic, despite improving 14% q/q from a weak Q1. H1 demand was down 17% y/y at 141t, whereas demand value rose 26% y/y to US$21bn.

The quarter was characterised by two contrasting phases. Jewellery demand received support from Akshaya Tritiya and wedding-related buying in April, while the correction in gold prices from earlier peaks also helped improve consumer sentiment. Conditions weakened markedly from mid-May through mid-June, however, due to Adhik Maas,¹ the sharp hike in import duty from 6% to 15%, and a series of government measures aimed at moderating gold imports, including a direct appeal from Prime Minister Modi to avoid buying gold.

Consumers continued to adapt to high prices through product substitution. Demand increasingly gravitated towards lighter-weight jewellery, while organised retailers continued to benefit from growing sales of studded jewellery and lower-carat products. These trends were particularly evident among larger chain stores, whose customer base is more heavily weighted towards urban consumers.

A divergence between organised and traditional retail channels also remains evident. While larger retailers continue to expand inventories and increase their network of stores, many independent and mid-sized jewellers find themselves more exposed to the weakness in traditional 22k jewellery demand. Nevertheless, consumer affinity towards gold jewellery appears intact and spending remained resilient despite lower tonnage volumes.

Looking ahead, jewellers reported stronger activity in July as consumers took advantage of lower prices ahead of the forthcoming wedding season. This seasonal demand should provide further support in H2, although the monsoon and outlook for rural incomes remain important variables.

Middle East and Turkey

Middle Eastern jewellery demand remained weak in Q2 as elevated prices continued to weigh on affordability. Despite the backdrop of regional geopolitical disruption, some support came from prices below their earlier peaks.

Saudi Arabia was among the region's stronger performers. Demand saw a relatively modest 8% y/y decline as Hajj-related tourism, wedding demand and Eid-related buying offset price-led weakness. Anecdotal reports suggest that demand strengthened noticeably from mid-May onwards as the price correction improved sentiment.

Demand in Egypt fell 14% y/y amid persistent inflation and currency volatility. Meanwhile, the UAE recorded a 14th consecutive quarterly y/y decline. It was also one of the few markets to see a y/y drop in US dollar demand value. Given the UAE's reliance on tourists as a source of jewellery demand, the Iran conflict weighed on activity as tourist arrivals slumped. The market gained some support from lower prices and Indian expatriate demand, the latter of which will likely be boosted during H2 thanks to India's import duty hike affording the region a price advantage.

Iran also remained heavily affected by the regional conflict, which continued to disrupt economic activity and weigh on consumer sentiment. Selling back of gold jewellery was seen by some as an accessible source of funds to cover expenses and relocations.

Turkey remained under pressure, where elevated inflation and subdued consumer confidence constrained demand. Nevertheless, lower local premiums and the correction in local gold prices helped support a modest q/q recovery, with further support from wedding-related purchases later in the quarter.

US and Europe

US gold jewellery demand remained weak during Q2, but value held up better. Elevated gold prices continued to restrict sales in volume terms and consumers increasingly favoured lighter-weight and lower-carat products. Weakness was concentrated in the mass market, while higher-end jewellery proved more resilient.

European demand followed a similar pattern. Consumption across the region fell as elevated prices weighed on affordability. Italy saw the sharpest regional decline in consumer demand (-19% y/y), while its struggling fabrication sector had again to contend with weak export markets.

ASEAN Markets

Jewellery demand across ASEAN markets remained under pressure. High prices weighed on affordability and encouraged substitution towards investment products. Lower-carat jewellery gained further market share throughout the region as consumers adjusted their buying behaviour to the high-price environment.

Indonesia experienced a thirteenth consecutive y/y decline as consumers – dealing with challenging economic conditions – increasingly shifted towards lower-purity jewellery. Malaysia continued to see a structural shift towards lower-carat products, while consumer sentiment in Thailand was undermined by gold price volatility. Vietnam posted the region's largest y/y drop (-28%) as elevated local prices added to broader cost of living pressures.

Rest of APAC

Japan remained one of the more resilient jewellery markets. Although demand continued to soften, spending in yen terms remained comparatively healthy and asset-style jewellery retained appeal among consumers seeking products with investment characteristics.

South Korea was a clear outlier, recording modest growth in jewellery demand (+6% y/y). Wedding-related purchases benefited from the correction in gold prices, although the market's ongoing shift towards lower-carat and lighter-weight products continued and this will likely pose a headwind to any long-term recovery in the jewellery sector.

Elsewhere, Australia saw jewellery demand weaken in line with global trends as elevated prices constrained discretionary spending.