Asia Gold Market Update: India Premiums Reach 10-Month High as Festive Demand Rises, While China Discounts Deepen

September 2025 — Asia’s gold trade showed contrasting trends this week, with India seeing a sharp rise in premiums driven by festive season demand, while China continued to witness widening discounts amid sluggish local buying.

Festive Rush Lifts India’s Gold Market

India, the world’s second-largest gold consumer, has entered its busiest buying period of the year as the festive season draws near. Retail demand surged ahead of celebrations such as Navratri and Diwali, which traditionally see families purchasing gold jewelry and coins as symbols of prosperity and wealth.

Dealers reported that premiums on imported gold climbed to their highest levels in 10 months, reflecting both stronger consumer interest and limited supply. The festive season is often a decisive factor in India’s annual gold demand, and this year’s early surge suggests confidence among households despite broader economic concerns.

One Mumbai-based jeweler noted, “The mood is upbeat. Families are coming in to book gold early, anticipating higher prices later. The cultural pull of gold during festivals is something no slowdown can shake.”

China Faces Weak Demand and Discounts

In contrast, China — the world’s top gold consumer — is experiencing subdued demand, leading to widening discounts in the local market. Analysts pointed to a combination of weaker retail appetite, slowing economic activity, and competition from alternative investments as factors weighing on gold purchases.

Dealers in major cities reported higher-than-usual discounts against global benchmark prices, reflecting an oversupply that is not being matched by consumer buying.

A Beijing market analyst explained, “The economic outlook has made many households cautious. Unlike in India, cultural buying pressure is lower, so gold demand reacts more directly to price and sentiment.”

Regional Market Dynamics

The split between India and China underscores how cultural traditions, economic conditions, and consumer sentiment shape gold markets differently across Asia. While India’s festive season is expected to support global gold demand in the coming weeks, the sustained weakness in China could offset some of those gains.

Other Asian markets also showed mixed trends. In Singapore and Hong Kong, demand remained steady but without significant spikes, while Southeast Asian jewelers reported modest interest ahead of year-end holidays.

Looking Ahead

Analysts suggest that global gold prices could see short-term support from India’s buying spree, though persistent weakness in China will keep markets cautious. Much will depend on whether Chinese consumer sentiment improves later in the year, potentially narrowing discounts.

For now, Asia’s gold trade reflects a tale of two giants: India, where tradition continues to fuel demand, and China, where economic pressures are reshaping consumer behavior.