"The Indian market is showing signs of recovery, up 9% to 223.1 tonnes from 204.8 tonnes in Q3 2011 following increases in both jewellery and investment demand. In comparison with Q3 2011 jewellery demand was up 7% to 136.1 tonnes and investment demand rose by 12% to 87.0 tonnes.
Investors moved into the imitation coin market, up 59%, whilst jewellery increased due to re-stocking ahead of the Indian wedding and festival season. Indians appear to have acclimatised to recent price trends and have been buying into a rising market," the Council has stated.
Marcus Grubb, Managing Director, Investment at the World Gold Council said, "Gold is beginning to re-establish itself as part of the fabric of the financial system. In the medium term, the quantitative easing initiatives in the West and the continuing growth story in the East, particularly in India and China, coupled with the seasonally strong quarter coming up in Asia, are excellent indicators for further growth in the gold market.
Meanwhile, demand for ETFs and similar products in Q3 was up by 56.0% on the previous year to 136.0t.
On the other hand demand in the jewellery sector was down 2.0% to 448.8 tonnes compared to 458.0 tonnes in the same quarter in 2011. The ongoing slowdown in China continued to dampen demand in the second largest regional jewellery market.