Indian PM Modi has told Indians to avoid buying gold unless necessary, Bloomberg reports

Indian officials have periodically leaned on gold buying when the import bill and the current account balance become uncomfortable, and the pattern on past occasions has been jawboning first, followed by harder levers such as higher import duties or restrictions if flows do not slow. India is one of the largest sources of physical demand globally, so the transmission runs through spot premiums and imports rather than the futures curve directly, and a demand warning from the top of government tends to compress local premiums even before any policy change. The distinction that matters is between rhetoric and action: previous episodes have shown that official discouragement alone dents discretionary and jewellery demand at the margin, but structural buying around weddings and festivals has historically proved sticky, while duty changes move the numbers far more decisively. Worth watching is whether the remarks precede a fiscal measure on import duties or tighter import rules, and whether smuggling premia begin to widen, which has been the tell in earlier crackdowns. For bullion more broadly, the read is softer physical offtake from a key consumer rather than any shift in the macro drivers of the metal.