Silver jewellery drove inflation more than gold in May: What it means for buyers

Silver jewellery had a greater impact on India's retail inflation than gold in May, according to a report by State Bank of India Research.

"Item-wise inflation shows maximum contribution from silver jewellery of 56 bps in May 2026, followed by gold 30 bps. Though gold's contribution has remained same as in April, silver contribution has increased modestly from 52 bps in April," SBI Research said in its latest Ecowrap report.

Apart from precious metals, the report said higher petrol and diesel prices pushed up transport inflation, while a slight LPG shortage contributed to a rise in restaurant and accommodation costs. Petrol's contribution to headline inflation increased to 14 basis points in May, while higher prices were also observed in items such as refined oil, mustard oil, milk, fish, chicken and goat meat.

"India's Consumer Price Index (CPI) inflation rose to 3.93% in May 2026, up from 3.48% in April 2026. The impact of increase in petrol/diesel prices and slight LPG shortage is clearly visible in May data. Transport inflation increased by whopping 176 bps to 1.8% in May as compared to April. Similarly, inflation in Restaurants and accommodation services (which largely depend on LPG) increased by 154 bps to 5.7% in May as compared to 4.2% in April. The moderate rise in gold and silver prices led to almost 80 bps increase in inflation rate in the personal care division," said SBI Research Report.

The report added that global commodity trends also reflected stronger price pressures in silver compared with gold during the month.

"Global commodity prices as per World Bank pink sheet too show higher inflation in case of silver in May compared to gold," the report noted.

What it means for consumers

The report suggests households planning jewellery purchases may face higher costs if silver prices continue to rise.

As CFP Shweta Shastri explained, “Inflation has slightly increased to around 4%, but the real impact is already visible in your daily life. You may not notice it in one big jump, but slowly everything is getting a little more expensive. One interesting trend this time is that silver prices have risen more than gold. So if you are planning to buy jewellery especially silver items you might feel the pinch more than before.”

She added that fuel prices are another key driver. When petrol and diesel go up, transport costs rise, and that slowly feeds into everything from groceries to eating out. “That’s why your monthly budget may feel tighter even if your income hasn’t changed,” she said.

Consumer Price Index (CPI) based inflation in the food basket was 4.78 per cent in May, higher than 4.2 per cent in April, according to the National Statistics Office (NSO) data.

Precious metal jewellery, tomato, ginger, and raisin (kishmish) and monacca were the five items with higher inflation in May, according to NSO data.

NSO under the Ministry of Statistics and Programme Implementation collects real-time price data from selected 1,407 urban markets (including online markets) and 1,465 villages covering all States/UTs.

On the other hand, potato, peas, motor car and jeep, cumin (jeera) and 'motorcycle and scooter' were the top 5 key items with low inflation at the all-India combined level in May 2026.

No near-term rate cut expected: SBI Research Report

Looking ahead, the report said the inflation outlook would depend on factors such as global energy prices, exchange-rate movements, monsoon progress and supply-chain conditions. It added that it does not currently expect another rate cut by the Reserve Bank of India in August.