Demand for gold bars and coins increased 46% to its highest level during the April-June period since 2014, driven by expectations of further price appreciation and safe-haven buying, WGC said. However, jewellery sales fell 17% as buyers did not want to pay hefty making charges on top of already high prices, it said.
Making charges can go as high as 35%, depending on the type of jewellery. In terms of volume, gold jewellery demand fell to 106.5 tonnes from 128.6 tonnes a year ago, as per the data.
Gold price reached a high of ₹74,268 per 10 gm during the quarter, compared with ₹61,819 in April-June 2023.
Jewellery demand came under pressure due to high prices, the general election and severe heatwaves. While festivals such as Akshaya Tritiya and Gudi Padwa provided a temporary boost, record prices dampened consumer sentiment.
"India's gold demand softened slightly in Q2 2024, reaching 149.7 tonnes, down 5% year-on-year," said Sachin Jain, regional CEO, India, World Gold Council. "This can be attributed to record-high gold prices impacting affordability and causing a slowdown in consumer purchases. However, the overall value of demand remained strong, increasing by 14%, highlighting gold's enduring value for Indian consumers."
Bucking global trends, gold recycling in India fell 39% year on year to 23 tonnes, as consumers, rather than cashing in, opted for an exchange of old jewellery for new. This indicates limited distress selling and points to gold's enduring role as a store of value in the country, according to the council.
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