Gold Jewellery demand in India for the third quarter ending Sept 2020 of the calendar year 2020 dropped a whopping 48 per cent, a World Gold Council report shows.
According to the report in the third quarter of 2019 the demand for gold jewellery was 101.6 tonnes vs gold demand of just 52.8 tonnes in Q3 2020. "While China and India were major contributors to the global weakness (by virtue of their significance to the market), weakness was virtually universal, with no bright spots of note. Jewellery demand for the year to date totals just 904 tonnes, the weakest in our data series by some margin," the WGC has stated.
"This is 30% weaker than the equivalent period of 2009 - the next lowest Q1-Q3 total and the time of the Global Financial Crisis (GFC) - when demand reached 1,291.7 tonnes. Although Q3 saw widespread recovery from the depths of the Q2 weakness, economies around the globe remained under the shadow of COVID-19 and this is reflected in the y-o-y figures for jewellery demand. The strong rally in the gold price - which reached record levels in almost all key currencies - further magnified the effect. Between January and end-September, the US-dollar gold price had increased by 25%," it has stated.
"The continued impact of the ongoing global pandemic at a time when gold prices reached a new record high had unsurprisingly negative implications for gold jewellery demand. Global demand was 29% below an already relatively anaemic Q3 2019. In value terms, the comparison was less stark, as the strong rise in the price offset the lower volumes: Q3 jewellery demand was worth US$20.4 billion (bn), down 8% y-o-y," the World Gold Council has noted.
In India gold demand is expected to be slightly better with the advent of the festive season and also following the opening of the lockdown. However, price of gold continues to remain high.