The Indian jewellery market is set for a significant uptick in the latter half of 2024, with Nuvama's latest report predicting an 18% increase in demand volume. This growth is attributed to changing consumer trends and a surge in purchasing activity across semi-urban and rural markets, which have been driving demand for more affordable jewellery pieces.

While affluent buyers dominated the first quarter, the second quarter has seen a notable shift towards lower-priced items. According to the report, retailers are preparing for the upcoming festive season by expanding their store networks to cater to the expected rise in consumer demand.

Gold imports, a key indicator of the jewellery sector's performance, have shown promising signs. Nuvama's report highlights that imports in July and August 2024 were 11% higher compared to the same period in 2023, with August seeing a particularly strong recovery.

This rise in demand has been further bolstered by continued gold purchases by central banks, which have pushed both prices and volumes higher in the market. Currently, gold prices are 30% higher than the average levels recorded in the second half of 2023.

Domestic gold prices, which had been trading at a discount for five months due to excess inventory and subdued demand, received a significant boost following the reduction in basic customs duty announced in the Union Budget of July 2024.

Despite a 9% year-on-year decline in volume during the first quarter, the market is expected to bounce back as India enters the peak wedding season. July and August 2024 have already shown positive signs of recovery, and further growth is anticipated.

The World Gold Council (WGC) has projected that gold demand in the calendar year 2024 will reach 850 tonnes, reflecting a 12% year-on-year growth, further strengthening the positive outlook for the jewellery industry.