Indian Gold jewellery demand staged a modest recovery from its Q2 record low but remained well below 2019 levels, according to World Gold Council (WGC). Demand was 48% lower y-o-y at just 52.8 tonnes (t) - the third lowest quarter for Indian jewellery demand in WGC data series. Not only did Indian consumers have to cope with recurring lockdowns and unprecedented gold prices, but also the inauspicious periods of Pitru-Paksha and Adhik Maas discouraged buying during September.
As the local gold price breached Rs 50,000 per 10gm - a major milestone for India - casual/impulsive purchases were curtailed in favour of needs-based buying. The prohibitive price level also encouraged a shift to lighter-weight plain gold pieces.
Despite the positive monsoon season, consumer confidence remains heavily impacted by the economic impact of the measures imposed to contain the pandemic. India's GDP contracted by a whopping 23.9% in Q2 2020 and is expected to contract by 12.7% in Q3. WGC says that the weak picture for jewellery demand has not translated into a surge of selling by Indian consumers. Instead, there has been an increasing focus on the use of gold as collateral for loans.
Powered by Capital Market - Live News
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)
Dear Reader,
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.
Digital Editor
RECOMMENDED FOR YOU