Gold bars and coins captured 41% of India's total gold demand in Q1 2026, marking a significant shift from traditional jewellery purchases. According to data from the World Gold Council (WGC), bar and coin demand reached 62.3 tonnes in the quarter ended March 2026, representing a substantial increase from 34% share in the same period last year. This represents a dramatic departure from the typical 20-30% range these products have historically accounted for over the past decade.
The investment-focused trend has become increasingly pronounced, with investment demand accounting for nearly 70% of total gold demand in Q1 2026, while jewellery's share fell to around 30% - the lowest level since 2000. As reported by the World Gold Council, bar and coin demand was almost three times higher than gold ETF demand of 19.9 tonnes in the first quarter of 2026. Annual demand from bars and coins has grown from 161 tonnes in 2016 to 280 tonnes in 2025, with the growth accelerating from 2024 onwards. Despite the first quarter seeing a net outflow of 225,000 ounces from exchanges and ETFs, demand for physical bars and coins rose by 149,000 ounces, indicating strong physical investment demand.
In value terms, bar and coin demand experienced remarkable growth, surging 129% from $4 billion in Q1 CY25 to $10 billion in Q1 CY26. According to the World Gold Council, this dramatic increase reflects the elevated gold prices, particularly early in the quarter when gold outperformed other domestic assets. The preference for coins and bars is supported by their convertibility into jewellery, unlike ETFs, and their availability in smaller ticket sizes of ₹5,000-₹10,000 compared to larger jewellery denominations. Looking ahead, physical bars and coins demand is projected to climb by 27% to 718,000 ounces for the full year 2026, reaching a six-year high, while total investment demand is expected to fall by 54% due to ETF outflows.
The shift towards gold investment is not limited to India, with global retail investors following similar patterns. According to eToro's latest Retail Investor Beat survey, 50% of 1,000 Singapore-based retail investors are now invested in gold, up from 45% in Q4 2025. For commodity investors, gold represents 79% of their holdings, followed by silver at 36%, oil at 24%, natural gas at 18%, and copper at 12%. As noted by LKP Securities Vice-President Jateen N Trivedi, the sharp rise in gold prices over the past year, combined with challenging equity markets, has significantly boosted investor interest in gold. The new generation of investors in gold and silver typically prefers bars and coins over jewellery due to their accessibility and minimal making charges.
