Should you buy gold and silver this Dhanteras as prices touch all-time high

Rising gold prices have cast a shadow over jewellery sales ahead of auspicious Dhanteras, with retailers anticipating lower sales volumes despite recent customs duty reductions. The precious metal’s price has surged to unprecedented levels of around Rs 80,000 per 10 grams, while silver has crossed the Rs 1,00,000 per kg mark in the national capital. 

 

Gold and silver have witnessed a stellar rally this calendar year, touching new highs. Gold has posted over 28 per cent returns in the past 12 months, whereas silver has posted over 33 per cent returns.

 

Industry experts predict a 10-12 per cent decline in sales volume compared to last year’s Dhanteras, though higher prices could still drive a 12-15 per cent growth in value terms.

 

“The global uncertainties have pushed gold prices up too rapidly in a short period,” notes Suvankar Sen, Managing Director and CEO of Senco Gold and Diamonds.

 

The recent geopolitical tensions, particularly the Israel-Middle East conflict, have strengthened gold’s position as a safe-haven investment, contributing to the price surge. Despite these challenges, some jewellers remain optimistic about the upcoming festival season, citing an estimated 40 lakh weddings scheduled after Dhanteras.

 

Saiyam Mehra, Chairman of All India Gem and Jewellery Domestic Council (GJC), expects sales volumes to maintain last year’s levels at around 20-22 tonnes on Dhanteras day. While the government’s recent reduction in customs duty from 15 per cent to 6 per cent initially boosted business, current high prices have led to a 10 per cent decline in sales compared to the previous year.

 

So should you bet on gold and silver?

 

“Dhanteras is the time when demand for precious metals like gold and silver is usually high. If one has a long-term investment horizon, then gold would be an ideal choice. Gold prices have been witnessing a price rise due to various factors, geopolitical tensions being the major one fuelling gold’s rally. Going forward, a low interest rate regime will likely support gold prices,” said Colin Shah, MD, Kama Jewelry

 

“On the contrary, if one is looking for a more accessible option, then silver could be a better choice. In addition to being a precious metal, having ornamental value, silver is also an industrial metal. Given its hybrid nature of being a precious and an industrial metal, silver prices are likely to mirror the rally in gold,” he said.

 

“Digital gold platforms make it easier to purchase, store, and gift gold in a secure manner. Additionally, gold’s liquidity and versatility -- whether it's in physical form or as digital gold — make it a superior asset, ideal for gifting or investing during auspicious times like Dhanteras,” Veer Mishra, founder of PLUS Gold- 

 

The coming festival season will be a crucial test for India’s jewellery market as it navigates through record-high gold prices while trying to maintain sales momentum through wedding-related purchases and investment demand.

 

The rural sector could provide some relief to jewellers, according to World Gold Council's India Regional CEO Sachin Jain.

 

“Good monsoon and higher crop sowing this year are anticipated to boost rural incomes, potentially leading to higher gold purchases,” he said. The council expects sustained gold demand through Diwali and until year-end, driven by the wedding season.