Prime Minister Narendra Modi’s reported appeal to the public to avoid purchasing gold for one year has triggered sharp reactions in financial markets, particularly impacting gold-linked equities. The announcement led to a notable decline in investor sentiment, with jewellery stocks witnessing heavy selling pressure during Monday’s trading session.
In the stock market, leading jewellery companies recorded steep losses. Titan Company declined by around 7%, while Kalyan Jewellers fell by over 9%. Other listed players such as Senco Gold and Sky Gold also witnessed a sharp correction, ranging between 10% and 12%, reflecting concerns over potential demand slowdown in the sector.
However, market participants in the physical gold trade indicated that retail demand remained largely stable. Jewellery retailers reported no significant change in consumer buying behaviour, suggesting that the immediate impact of the appeal has been more pronounced in financial markets than in ground-level sales.
Meanwhile, domestic bullion prices registered a mild decline. In Delhi, the price of 24-carat gold fell by over ₹600 per 10 grams, closing at approximately ₹1,51,920. As per the All India Sarafa Association, Hyderabad also saw a slight dip, with 24-carat gold priced at around ₹1,53,550 per 10 grams, while 22-carat gold fell to about ₹1,40,650 per 10 grams. Silver prices remained stable at ₹2.85 lakh per kilogram.
Analysts attribute the developments to broader global economic conditions, including geopolitical uncertainty and rising crude oil prices, which continue to exert pressure on India’s foreign exchange reserves. Since India imports significant volumes of both crude oil and gold, the reported appeal to curb discretionary gold purchases and foreign travel is being viewed as part of efforts to conserve dollar reserves and stabilise the external economic position.