Gold prices fell in India during June as domestic demand for both jewellery and investment continued to weaken [1].

The slump reflects a cooling of the domestic market following significant policy changes and economic shifts that have deterred buyers from entering the market.

Surendra Mehta, a representative of the Indian Bullion & Jewellers Association (IBJA), said weak demand for both jewellery and investment persisted through June [1]. This trend follows a sharp increase in the customs duty on gold, which was raised to 15 percent [2] on May 13, 2026 [2].

Market analysts said the high import duty has acted as a barrier to entry for many consumers. Additionally, subdued returns in the equity markets have dampened the appetite for jewellery purchases. While some reports previously indicated that investment demand had surged to top jewellery demand in the March quarter, current data suggests that investment interest has not been enough to offset the broader slump [3, 4].

Despite the current decline in prices and demand, some projections remain high. The near-term gold price target in India is estimated at Rs 1.38 lakh per 10 grams [1]. This target suggests a potential for recovery even as the market struggles with the immediate impact of the duty hike and broader economic headwinds.

The interaction between government fiscal policy and consumer behavior continues to shape the gold market. The 15 percent duty [2] remains a primary factor in the current pricing volatility, and the reluctance of domestic buyers to commit to large purchases.

“Gold prices fell in India during June as domestic demand for both jewellery and investment continued to weaken.”

The decline in gold demand indicates that the Indian government's decision to raise import duties has successfully curtailed imports but at the cost of domestic market liquidity. The struggle for investment demand to offset the jewellery slump suggests a broader cautiousness among Indian consumers, who are balancing gold acquisitions against underperforming equity markets.