India's gold demand surges again
Wed, 28 Oct 2015 12:05:28 -0600
India regained its top position as largest gold consumer with 642 tonnes year-to-date
After a long slump, there was a surge in demand for gold in September quarter, with imports of the precious metal also rising 23 per cent, the quarterly report by consultancy GFMS showed.

India also regained its top position as the largest consumer at 642 tonnes year-to-date, with China trailing by 63 tonnes.

Retail investment in gold grew 30 per cent during July-September against the year-ago quarter to 55 tonne, which is the highest since Q4 2013. During this period, gold price fell close to $1,080 per ounce the lowest since August 2011.

Jewellery consumption increased by 5 per cent to 193 tonne, which too was the highest since Q1 2011 and the highest third quarter demand since 2008.

An increase in jewellery and investment demand resulted in 23 per cent rise in gross official imports at 263 tonne. Nearly 61 tonne of the 65.1 tonne imported in July took place between July 20 and July 31.

Similarly in August, 55 tonne of the 68.5 tonne were imported by August 20. In September, the bullion imports fell to the lowest since January this year.

Sales in August were the best for three months, rising 40-60 per cent year-on-year. Another factor that supported higher volumes was a drop in the exchange of old jewellery for new. Exchanges accounted for approximately 35 per cent of total sales, against 40-45 per cent in the first two quarters.
Impressive demand despite fears of a poor monsoon and its impact on crops indicated lower dependence on agricultural income to fuel spending on gold.
Unofficial imports in Q3 are estimated at 28.7 tonnes, the highest in the three quarters, GFMS said.
The organization expects gold to average $1,100 per ounce in Q4 of calendar 2015, down by $75 per ounce from its previous forecast and this makes for an annual average of $1,159/oz in 2015.
Gold is set to remain under pressure until there is more clarity on the timing and the scale of US rates normalisation. Among other bearish factors are low inflation expectations and generally weak investor sentiment towards precious metals.

comments powered by Disqus
Your Money Guide

MoneyGuru learning »