Jewellery Demand in India Surges 63%; Hits Second Highest Record

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Jewellery demand in India saw a sharp surge of 60 per cent year on year to 183 tonnes in Q3 2014, making it the second highest Q3 on record for the country.

Jewellery Demand in India Surges 63%; Hits Second Highest Record
"While the increase is partly reflective of the weakness in Q3 in India last year - when the government introduced import curbs and raised import duties - it also demonstrates the resilience of the country's appetite for gold jewellery," findings from the a World Gold Council Report shows.

Improved consumer confidence in both the domestic economy and the new government added to the positive sentiment, with strong levels of purchasing being seen in the build up to Diwali.

The key findings from the report are as follows:

1) Jewellery remains the biggest component of gold demand, representing more than half of all demand at 534t, which is 4% lower year on year. Jewellery demand was driven by India, which increased 60% to 183t. In the UK (up 18%) and the US (up 4%) demand was also strong. Chinese jewellery demand fell 39% to 147t as the jewellery market caught its breath after an exceptional year for demand last year.

2) Central banks bought 93t of gold in Q3 2014, 9% lower year on year, but year to date central banks have bought 335t verses 324t last year. This is also the 15th consecutive quarter that banks were net purchasers of gold.

3) Investment demand (bars and coins and ETFs) was up 6% to 204t. However, there was a 21% fall in bar and coin demand from 312t to 246t following unprecedented levels of demand last year. ETF outflows stood at 41t compared to 120t in the same period last year.

4) Technology demand was 98t, 5% lower than a year ago as the industry continued its shift towards alternative materials in technological applications where it is safe to do so.

Read more about: gold, jewellery
Story first published: Thursday, November 13, 2014, 10:55 [IST]
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