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India bracing for lowest ever gold demand this year

Thu Oct 29 2020


Hit by Covid pandemic and job losses across sectors, gold demand in India is slated to be one of the lowest ever in this year.


In the first three-quarters of this fiscal, gold demand was down 49 per cent at 252 tonne (496 tonne), according to the report released by the World Gold Council on Thursday.


In the September quarter, it plunged 30 per cent to 87 tonnes (124 tonne) on the back of sharp fall in jewellery demand which was down 48 per cent to 53 tonnes (102 tonne).


Somasundaram PR, Managing Director (India), World Gold Council said gold demand in December quarter last year was 194 tonne. Even if the demand of the previous year is achieved, the overall market should be 446 tonne in 2020 which will be the lowest since 1995 when the demand was 462 tonnes.


However, he said, "we did not want to hazard a guess on this year's demand as there are a lot of uncertain factors playing out due to the Covid pandemic".


Even though everyone thought the stock market would crash due to lower economic growth, it is hitting a new high daily. Excess global liquidity is driving gold prices even though the demand has fallen, he said.


"We are not predicting the year's gold demand even though there are only eight weeks to go in this year because all the tool to predict demand has failed due to Covid pandemic," he said.