MUMBAI: With gold prices beginning to rise again, a Wall Street brokerage has said the upward price movement can add 100 bps to the country’s GDP as the households sit over 25,000 tonne of the yellow metal, whose value has more than doubled to $3.9 trillion by March 2026 from $1.9 trillion in March 2024.
“Indian households are holding more than 25,000 tonne of gold which at today’s price is around $3.9 trillion. That is about four times the value the households holding in stocks, and nearly 35 times the $111 billion or 880.2 tonne gold held by the Reserve Bank,” Jefferies said in a note Monday.
It further said the surge in gold prices over the past year has created a hidden boost to the country’s economy, one that has not fully shown up yet.
Share of gold in total household wealth has also grown fast, Jefferies said, estimating that gold made up 24.2% of household assets in March 2026, up from 15.4% in March 2023, even as total household assets grew from $11.3 trillion to $16 trillion. Over the same period, the share held in property fell from 51.3% to 47.6%, and the share held in bank deposits fell from 14.1% to 11.2% and equities held roughly steady, at 5.6% and 5.7%.
Gold has also drawn money through exchange-traded funds with gold ETF assets rising from $2.8 billion in March 2023 to $18.1 billion in July 2026.
On the gold loan market, Jefferies estimates organised gold loan market stood at $197 billion as of March 2026, up 73% in dollar terms over the past two years. Gold loans now account for about 7% of total bank and NBFC credit, and gold-based lending has risen from under 4% of bank and NBFC credit before 2020 to about 5.1% in March 2026.
Gold loans as a share of the total value of household gold holdings actually fell by about 80 bps from March 2024 levels, despite gold prices rising sharply over the same period. Jefferies estimates only around 15% of household gold is currently used as collateral, through formal or informal lending channels, assuming a loan-to-value ratio of about 65%.
The brokerage expects this gap to narrow. It estimates a "reversion" over the next two years could add 8-10 percentage points to the monetisation ratio, adding roughly $15-20 billion a year in gold loans. On top of that, it estimates a further 10% rise in gold prices could generate about $400 billion in additional household wealth and another $20-25 billion in gold loans. Together, this could add another 80-100 basis points of tailwind to GDP and consumer spending.
Gold imports, including jewellery, are about 10% of the country’s total imports. Gold import bill rose from $36 billion in FY23 to $79 billion in FY26, equal to about 2% of GDP, and that this weighs on the current account deficit. India's broader gems and jewellery market is about 80% gold jewellery, grew from $36 billion in FY19 to an estimated $118 billion in FY26.
Separately, RBI's own gold reserves have grown too, rising from $52 billion in March 2024 to $111 billion in August 2026. Gold's share of the total foreign exchange reserves rose from about 8% to about 16% over roughly the same window, it said.
