Shining again: India’s gold demand bouncing back to pre-Covid levels

By: |
October 29, 2021 1:45 AM

The market development organization for the gold industry added that with restrictions being gradually lifted across the country, retail demand is bouncing back to pre-Covid levels.

WGC reports that Q3 demand reflects a combination of low base effect and return of positive trade and consumer sentiments.WGC reports that Q3 demand reflects a combination of low base effect and return of positive trade and consumer sentiments.

Gold is likely to see a sharp spike in demand in the fourth quarter (October-December) of 2021 aided by softer gold prices and return of positive trade sentiments, the World Gold Council (WGC) said on Thursday.

The market development organization for the gold industry added that with restrictions being gradually lifted across the country, retail demand is bouncing back to pre-Covid levels.

“With the upcoming festive and wedding season, there is all the more enthusiasm towards gold demand, and we anticipate it to be the busiest gold-buying season, since the start of Covid. Rising inflation tends to drive the gold demand. Gold is perceived as a strong hedge against inflation and decades of data supports this assumption. While we have not made any forecast for the rest of the year, barring any unexpected twist in the tale, we could see a sharp spike in demand in Q4 2021,” said Somasundaram PR, Regional CEO, India, World Gold Council.

According to the report, demand for gold in India for Q3 (July – September) 2021 was at 139.1 tonne up by 47% as compared to the overall Q3 demand of 94.6 tonne for 2020. Total net bullion imports in Q3 2021 were 255.6 tonne, an increase of 187% compared to 89 tonne in Q3 2020.

WGC reports that Q3 demand reflects a combination of low base effect and return of positive trade and consumer sentiments.

“This is primarily driven by what appears to be a firm grip on the pandemic with higher vaccination rates and falling infection rates, leading to a strong rebound in economic activity. Softer gold prices have also generated significant consumer interest ahead of seasonal demand. Trade activity witnessed during various buyer-seller meets and anecdotal feedback from manufacturers indicate that this Q4 festive season could be on the best in several years, with strong imports (255.6 tonnes and 187% increase over last year) much ahead of Q3 demand,” Somasundaram said.

Total jewellery demand in India for Q3 2021 increased by 58% at 96.2 tonnes as compared to Q3 2020 (60.8 tonnes) and the value of jewellery demand was `41,030 crore, up by 48% from `27,750 crore in Q3 2020.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1Sugar exports slow as global prices fall
2Tomato prices skyrocket to Rs 140/kg in South due to rains
3Gold rate falls as FED speculation keeps pressure on metals, expect prices to move sideways to down