Gold demand in India up 8% to 136.6 tonne in Jan-Mar period

India experienced an 8% annual increase in gold demand, reaching 136.6 tonnes in the March quarter.

India’s stock markets have been rising and in tandem, gold prices have been increasing. It has been nothing short of a surprise. The demand for the yellow metal has been steady and now the numbers are in.

Gold price has been rising in India.

India experienced an 8% annual increase in gold demand, reaching 136.6 tonnes in the March quarter. This growth was supported by a robust economic landscape, despite gold prices reaching record highs, as reported by the World Gold Council. To that can be added the gold buying exercise by the Reserve Bank of India (RBI). In effect, it went to boost demand even more.

During the January-March period of this year, India's gold demand in value terms surged by 20% annually, reaching ₹75,470 crore, PTI reported. This increase can be attributed to both volume growth and a rise in quarterly average prices by 11%.

The World Gold Council (WGC), which unveiled its latest global report, 'Gold Demand Trends Q1 2024,' on Tuesday said that India's overall gold demand, encompassing both jewellery and investment, rose to 136.6 tonnes in January-March of this year, up from 126.3 tonnes in the corresponding period of the previous year.

Jewellery demand in India saw a 4% uptick, reaching 95.5 tonnes from 91.9 tonnes, contributing to the overall gold demand. Additionally, investment demand, including bars, coins, among other forms, surged by 19%, climbing to 41.1 tonnes from 34.4 tonnes.

Sachin Jain, Regional CEO, India, WGC, indicated that despite prices reaching historic highs, India's persistent robust macroeconomic environment remained conducive to gold jewellery consumption. He said, “India's continued strong macroeconomic environment was supportive for gold jewellery consumption even though prices reached a historic high in March leading to a slowdown in sales as the quarter ended.”

While in 2023 , the gold demand was 747.5 tonne, it is likely to be in the range of 700-800 tonne during this year, Jain added. However, it will depend on the price. The higher it is the lower the range.

And where does he see the gold demand heading in the April-June quarter, Jain said it might slow down because of a sharp rally in gold prices as well the general elections that are currently on in India.