Gold Prices Hit Record Highs Before Diwali, Analysts Predict Decline as Festival Demand Fades Away

Business News:  This Diwali, gold prices climbed to unprecedented levels. Across India, rates crossed ₹1.30 lakh per 10 grams, making it one of the most expensive festive seasons ever. Strong demand for weddings and festivals pushed buyers to jewellery shops. Long queues were seen at markets as people rushed to invest in gold. Investors are now keenly watching what happens after the festival season ends.

Chances of a Price Drop

Market experts believe prices could ease slightly in the coming week. They explained that the sharp rally before Diwali may slow down once festivities end. Physical demand is expected to fall, reducing pressure on supply. Analysts also suggest that the global market will influence whether prices continue climbing or drop from their current highs.

Global Factors in Focus

Experts point out that international cues like the US finance bill, UK inflation numbers, China’s economic data, and Federal Reserve policies will all impact gold prices. Any negative pressure from these signals could push rates downward. With investor sentiment turning cautious, gold may trade in a limited range instead of climbing further.

Experts Share Their Views

Pranav Mer of JM Financial Services said a “healthy correction” is possible now as festive buying slows. He added that prices already reflect current fundamentals. On the other hand, Prathamesh Mallya of Angel One noted that global uncertainty, US tariffs, and economic slowdown may keep gold strong until 2025. This shows the market remains divided on its future trend.

Dhanteras Witnesses Price Dip

Interestingly, on Dhanteras, gold prices actually fell. In Delhi, rates dropped by ₹2,400 to ₹1,32,400 per 10 grams. On MCX, December futures touched ₹1,32,294 but later slipped to ₹1,27,008 per 10 grams. Despite the fall, jewellery shops were crowded with buyers. The festive mood clearly outweighed concerns about high prices.

Buyers Keep Markets Busy

Across the country, Dhanteras and Diwali brought heavy demand for jewellery. Shops were packed, and traders reported a huge rise in sales compared to normal days. Even though record prices pinched buyers’ pockets, people still chose to buy gold for auspicious reasons. The cultural importance of gold purchases during festivals proved stronger than price barriers.

What Lies Ahead

Now that the festive season is ending, experts expect demand to cool down. Lower demand combined with global economic signals could bring some softness in prices. However, in the long run, gold remains a safe-haven investment. Buyers and investors will tread carefully, balancing cultural traditions with financial planning in the weeks ahead.