Gold Prices Soar: How Sky-High Rates Are Reshaping Consumer Choices And Jewellery Biz Strategy — From 22K To 18K

Gold Price Today: Gold prices have been on a remarkable rise in 2025, driven by geopolitical tensions, economic uncertainty, and strong safe-haven demand. On Tuesday, spot gold rebounded to $3,392.29 an ounce, rising 0.3% after a slight dip on Monday.

On the Multi Commodity Exchange (MCX) in India, gold futures for August delivery rose to Rs 99,251 per 10 grams, a gain of Rs 73 or 0.07%.

Analysts say heightened tensions, especially the ongoing conflict between Israel and Iran, and former US President Donald Trump’s call for evacuating Tehran, have made investors turn to gold for safety.

Trump’s return from the G7 summit early and his directive to the National Security Council to remain on alert further raised fears of escalation.

Consumers Are Changing Their Buying Habits

With prices rising over 25% in 2025 alone, and about 45% over the past year, gold has become increasingly expensive for retail buyers. As a result, consumer behaviour is shifting notably.

O Asher, Managing Director of Malabar Gold & Diamonds (India), said, “Rising gold prices are driving customers to shift from 22-carat to 18-carat jewellery. While the overall value of gold jewellery sales has increased, the per-customer volume has declined.”

To tackle this, Malabar has adapted by designing lighter-weight jewellery while keeping styles consistent. “If someone has a budget of one lakh rupees, they cannot increase it, so we’ve adapted our strategy. By keeping designs identical but reducing weight slightly, we ensure customers’ aspirations aren’t compromised,” Asher explained.

Brands Are Innovating to Stay Relevant

Recognising this shift, jewellery brands are launching new sub-brands and collections tailored to the modern buyer. On June 17, PNG Jewellers, one of India’s oldest jewellery houses, launched 'Litestyle' by PNG, a sub-brand offering lightweight, stylish gold jewellery crafted in 18K and 22 K.

Targeting women aged 25–40, Litestyle is meant for everyday wear—from work meetings to casual outings. The brand will open stores in Kharadi and Wakad (Pune) on June 22, with actress Sai Tamhankar inaugurating the launch.

Dr. Saurabh Gadgil, Chairman and MD of PNG Jewellers, explained, “The demand for versatile, lightweight pieces is no longer niche; it is a growing segment driven by women who view jewellery as part of their everyday identity.”

The company plans to open 12 Litestyle stores across Maharashtra in FY 2025–26 and scale to 100 stores by 2030, both online and offline.

Hemant Chavaan, Head of Marketing at PNG, added, “We’re bridging the gap between ceremonial jewellery and everyday wear, making premium gold and diamond pieces more accessible and relevant.”

Also Read: SBI Slashes Down Fixed Deposit, Savings Account Interest Rates

Gold as a Global Reserve

Beyond retail, gold is also gaining momentum as a global reserve asset. Central banks and governments are increasing their holdings. The Reserve Bank of India’s share of gold in its foreign reserves has nearly doubled since 2021, signalling strong institutional demand.

MP Ahammed, Chairman of Malabar Group, said, “Gold prices remain unpredictable, with no clear indication of future direction. However, rising jewellery prices boost consumer confidence, as we’ve witnessed consistent price appreciation over the past 25–30 years.”

The soaring price of gold is transforming both how consumers buy jewellery and how brands approach the market. With affordability becoming a key concern, companies are innovating through lighter designs, new carat preferences, and more practical collections.

Meanwhile, gold continues to attract attention not just for its beauty but as a strategic asset in uncertain global times.

(With inputs from ANI)