India regains spot as world’s top gold market
India regained its position as the world’s top gold consumer overtaking China as demand for the yellow metal surged by 39% year-on-year in the July-September quarter to 225.1 tonnes against 161.6 tonnes last year.business Updated: Nov 14, 2014 07:45 IST
India regained its position as the world’s top gold consumer overtaking China as demand for the yellow metal surged by 39% year-on-year in the July-September quarter to 225.1 tonnes against 161.6 tonnes last year. Overall improvement in macro-economic sentiment and softening prices led to a rise in jewellery sales, World Gold Council said on Thursday.
Jewellery demand in India jumped 60% to 182.9 tonnes in July-September, which WGC said was the second-highest third-quarter on record. In value terms, India’s total gold demand was up 31% to `56,219.3 crore.
“General sentiment among the Indian populace is up, aided by confidence in the new government… A weakening of the rupee and gold price during August and September also supported gold demand…The opportunity to buy at cheaper prices proved, for some consumers, hard to resist,” it said.
Somasundaram PR, managing director, WGC India, also pointed to the fact that there had been a dip in demand in the year-ago July-September quarter following several measures announced by the government such as hike in gold import duties to control the current account deficit.
“With the overall sentiment improving we are heading back to normal long-term average gold demand,” he said, adding that for the full year (2014) gold demand in India is likely to be in the range of 850-950 tonnes.
Somasundaram is hopeful that the government will review the restrictions and increased duties on gold imports as the measures have strengthened the grey market. WGC expects that close to 200 tonnes of gold will be imported into India illegally this year.
Meanwhile, global gold demand fell 2% to 929.3 tonnes in the third quarter — lowest in almost five years — dragged down by fall in Chinese demand. Jewellery demand in China plunged 37% to 182.7 tonnes.
It expects global gold demand this year will be between 4,000-4,100 tonnes, largely similar to last year.