Indian consumers displayed remarkable interest in gold, purchasing 51% more than China in July-September, totaling 248.3 tonnes. This surge, up 18% from last year, was fueled by reduced import duties and "revenge buying." Notably, India's dominance in gold coins and bars over China signifies shifting trends. Sachin Jain of the World Gold Council noted a 41% rise in investment demand, with prices attracting investors. Despite higher prices, gold demand soared, hinting at a strong year ahead with an estimated demand of 700-750 tonnes.
In a resounding show of enthusiasm for the precious metal, Indian consumers have outshone their Chinese counterparts by a significant margin, purchasing 51% more gold between July and September, as revealed by the latest data from the World Gold Council.
During this period, Indians acquired a total of 248.3 tonnes of gold, surpassing China's 165 tonnes. This uptick in demand represents an 18% increase year-on-year, a surge attributed to the reduction in import duty on gold from 15% to 6%, announced in the budget on July 23. Additionally, consumers engaged in what is being termed as "revenge buying," further fueling the demand for gold in the country.
While India had previously exceeded China's gold demand twice in the past eight quarters, those instances were primarily driven by purchases of gold jewelry. However, in the latest quarter, Indians notably surpassed China in the acquisition of gold coins and bars, purchasing 77 tonnes compared to China's 62 tonnes.
Sachin Jain, the regional CEO (India) of the World Gold Council, highlighted a significant surge in consumer demand, noting that momentum picked up notably from late July and remained robust until mid-September. Investment demand saw a remarkable 41% increase, with bar and coin demand hitting its highest point in a quarter since 2012. The price correction prompted by the July duty reduction spurred investor optimism and encouraged many to enter the market, contributing to this surge in demand.
In the same period, gold jewelry demand in India witnessed a 10% rise to 171.6 tonnes compared to the previous year. Meanwhile, consumer confidence in China remains notably low, impacting the country's gold consumption levels.
Despite the higher average price of gold at ₹66,614 per 10 grams, compared to ₹51,259.8 per 10 grams in the same period last year, the demand for gold continued to soar. With gold currently riding a bullish wave amidst a volatile equity market, predictions suggest that India's gold demand will remain robust in the upcoming quarter, fueled by events like Dhanteras and wedding-related purchases. However, the increasing gold prices might lead investors to wait for potential corrections before expanding their holdings. Sachin Jain anticipates the full-year gold demand to fall within the range of 700-750 tonnes, signifying a strong and enduring interest in gold among Indian consumers.
Comments