The World Gold Council (WGC) pegged a drop of 5% in gold demand in the April – June 2024 quarter at 149.7 tonnes. This was a drop from 158.1 tonnes in the previous corresponding period.
In value terms, however, gold demand in India by value in the April – June 2004 period stood at Rs 93,850 crore, WGC said, up by 14% as compared to Rs 82,530 crore in the previous corresponding period.
“India’s gold demand softened slightly in Q2-CY24. This can be attributed to record high gold prices impacting affordability and causing a slowdown in consumer purchases. However, the overall value of demand remained strong, increasing by 14%, highlighting gold’s enduring value for Indian consumers,” said Sachin Jain, regional chief executive officer for India at the World Gold Council.
Meanwhile, the gold prices surged 18% year-on-year (YoY) in the June 2024 quarter to $2,338.2 an ounce (oz), and were up nearly 13% when compared with the December 2023 quarter.
Jewellery demand in India, on the other hand too, felt the pressure of high prices, declining 17% to 107 tonnes due to high local prices, the general election and a severe heatwave.
WGC believes that while festivals like Akshaya Tritiya and Gudi Padwa provided a temporary boost, record high prices continued to dampen consumer sentiment. Investment demand, however, surged by 46% to 43.1 tonnes, its highest second-quarter level since 2014 driven by expectations of further price appreciation and safe-haven buying.
“India’s economic outlook too remains positive, with strong GDP forecasts and rural sector recovery are all likely to support demand in the second half of the year. Our forecast for full year demand is between 700 to 750 tonnes,” WGC said.
It said that going ahead, the recent 9% reduction in import duty on gold, WGC believes, is expected to revive the gold demand in July quarter ahead of the main festive season that begins from September that could be further boosted by a healthy monsoon.