Quick Facts
- Gold broke above $5,000 per troy ounce for the first time on January 26, 2026, after rising 64% in 2025
- Jewelry companies are pivoting to demi-fine materials and recycled gold to maintain margins
- Central bank buying and geopolitical tensions drive demand, not consumer jewelry purchases
Gold prices shattered records when they crossed $5,000 per troy ounce in January 2026. The precious metal peaked at $5,589 on January 28 before settling around $4,728 by mid-April.
The surge represents a 47% increase from March 2025 to March 2026. Gold’s 64% gain in 2025 marked its biggest annual increase since 1979.
Jewelry companies face unprecedented margin pressure. Rowan CEO Louisa Schneider told CNBC it’s hard to imagine any industry whose raw material costs have risen as dramatically.
“The demand is not coming from consumers that want to wear gold or industries that require gold as a component of manufacturing,” Schneider said. “This is coming from a hoarding of gold given an uncertainty around the U.S. dollar.”
BaubleBar co-founder Daniella Yacobovsky reports surging interest in demi-fine jewelry as an alternative to solid gold. The company offers similar quality at lower price points to combat rising material costs.
Central bank buying drives the rally. Banks purchased 220 tonnes in Q3 2025 while investment flows remained strong despite weakening jewelry demand. J.P. Morgan forecasts prices could reach $6,000 per ounce longer term.
Companies are adapting through multiple strategies. Many promote pieces with lower gold content while others focus on recycled gold from old jewelry. Alternative materials including platinum, silver, titanium and stainless steel gain popularity.
Independent jewelers face the biggest challenges due to limited margins. They’re rethinking collections and emphasizing craftsmanship over material value to maintain customer appeal.
The global gold jewelry market is projected to reach $133.1 billion in 2026, growing to $218.5 billion by 2035 despite current pricing pressures.
Geopolitical tensions and economic uncertainty fuel the rally. Supply chain disruptions and oil price spikes above $150 per barrel prompted central banks to diversify away from U.S. Treasuries into physical bullion.
