The bullion market in Ahmedabad witnessed a historic surge on Wednesday, with silver prices shattering the crucial psychological barrier of Rs 2 lakh per kilogram. In tandem, gold prices climbed to unprecedented record levels, driven by a potent cocktail of global economic cues and international instability.
Record Rally Driven by Global Factors
Silver experienced a dramatic jump of Rs 7,200 per kg, closing at approximately Rs 2.06 lakh compared to Rs 1.98 lakh on the previous day. Gold, not to be outdone, touched a fresh peak of Rs 1.385 lakh per 10 grams, inclusive of GST.
Haresh Acharya, Director of the India Bullion and Jewellers' Association (IBJA), pinpointed the causes behind this sharp rally. He stated that anticipation of an interest rate cut by the US Federal Reserve, combined with volatility in global currency markets and escalating geopolitical tensions, are fuelling the uptrend. "Investor concerns regarding potential tariffs and trade wars, alongside currency fluctuations, are driving capital towards traditional safe-haven assets like gold and silver. This, coupled with significant economic uncertainty, is keeping prices elevated," Acharya explained.
Jewellery Market Adapts to New Price Reality
The soaring prices are fundamentally altering consumer behaviour and demand patterns in the jewellery sector. While 22-carat gold has long been the staple for wedding purchases, the current price environment is pushing buyers towards lighter and lower-carat alternatives.
Jigar Soni, President of the Jewellers' Association Ahmedabad (JAA), noted a clear shift. "We are already observing a majority of purchases moving away from 22-carat and gravitating towards 14- and 18-carat gold jewellery. However, a fascinating development is that even 18-carat jewellery now carries a price tag exceeding Rs 1 lakh due to the rally," Soni said. He added that demand persists for 14- and 18-carat pieces, as well as lab-grown diamond jewellery, with many customers opting to exchange their old gold to fund new purchases.
The Rise of 9-Carat and Investment Demand
The price surge has significantly inflated the cost of 18- and 14-carat jewellery, prompting jewellers and consumers to explore even more affordable options. Param Begani, a lab-grown diamond jewellery retailer, highlighted the emerging trend. "At present, 14-carat gold is priced near Rs 82,520 per 10 grams, and 18-carat gold costs about Rs 1.05 lakh per 10 grams, both including GST. In this scenario, demand for 9-carat gold jewellery is poised to grow as it is lightweight and available in contemporary designs," Begani remarked. He also mentioned that alloys like copper and palladium are used in lower-carat jewellery.
This represents a substantial increase from just a month ago. On November 17, 2025, 18-carat gold jewellery was priced at Rs 98,440 per 10 grams, and 14-carat gold stood at Rs 76,310 per 10 grams.
Despite the elevated price levels, jewellers report robust investment demand alongside the ongoing seasonal wedding purchases. Nevertheless, industry experts warn that continued volatility in international markets is likely to keep bullion prices sensitive and on edge in the coming weeks.
