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13661
Thu, 07/24/2008 - 10:55
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http://m.oananews.org//node/13661
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India key to drop in global jewellery demand: WGC
New Delhi, July 24 (PTI) The fall in demand for gold jewellery in India due to surging prices in April-June this year has led to a 21 percent drop in the global market,according to a report.
According to the latest quarterly report by the World Gold Council, Jewellery demand declined by 21 percent year-on-year in the first quarter of this year to 445.4 tons,the lowest quarterly demand on record since 1993.
"The 121.5 tons decrease in total jewellery demand was largely attributable to a sharp drop in demand in the Indian market, which was almost 70 tons below year earlier levels,"the report stated.
It further pointed out that the upsurge in price volatility during the quarter came as no great surprise as thegold market in India is very price sensitive.
The other factors responsible for the decline in gold demand are currency movements and economic growth, the reportsaid.
Meanwhile, India also accounted for the 35 per cent year-on-year decline in retail investment for the first three months this year to 72.7 tons, according to GFMS (formerly, Gold Fields Mineral Services), an independent precious metalsconsultancy, it said.
The report said, India's contribution to the decline in net retail investment in Gold was the highest in terms of volume, which fell sharply to 31 tons, just over half thelevel of investment demand seen in quarter one last year.
In its outlook for the second quarter this year, the report stated that preliminary indications from Indian import data indicates to a further slowdown in demand, but the contraction in jewellery sales seems to have been less pronounced on a year-on-year basis than during the firstquarter.
While in Japan, profit-taking saw sales of existing holdings of bars and coins exceeded the new purchases by 37tons.
Besides, markets across the rest of Asia and the Middle East usually react in a similar way, with consumers focusing on price volatility. However, a notable decline in demand was witnessed in Egypt, where demand increased by more than oneper cent.
The booming economies of China and Russia provided the background for two of the more positive stories for gold jewellery demand in Q1 this year, with demand in each country rising by 9 per cent. PTI SM
According to the latest quarterly report by the World Gold Council, Jewellery demand declined by 21 percent year-on-year in the first quarter of this year to 445.4 tons,the lowest quarterly demand on record since 1993.
"The 121.5 tons decrease in total jewellery demand was largely attributable to a sharp drop in demand in the Indian market, which was almost 70 tons below year earlier levels,"the report stated.
It further pointed out that the upsurge in price volatility during the quarter came as no great surprise as thegold market in India is very price sensitive.
The other factors responsible for the decline in gold demand are currency movements and economic growth, the reportsaid.
Meanwhile, India also accounted for the 35 per cent year-on-year decline in retail investment for the first three months this year to 72.7 tons, according to GFMS (formerly, Gold Fields Mineral Services), an independent precious metalsconsultancy, it said.
The report said, India's contribution to the decline in net retail investment in Gold was the highest in terms of volume, which fell sharply to 31 tons, just over half thelevel of investment demand seen in quarter one last year.
In its outlook for the second quarter this year, the report stated that preliminary indications from Indian import data indicates to a further slowdown in demand, but the contraction in jewellery sales seems to have been less pronounced on a year-on-year basis than during the firstquarter.
While in Japan, profit-taking saw sales of existing holdings of bars and coins exceeded the new purchases by 37tons.
Besides, markets across the rest of Asia and the Middle East usually react in a similar way, with consumers focusing on price volatility. However, a notable decline in demand was witnessed in Egypt, where demand increased by more than oneper cent.
The booming economies of China and Russia provided the background for two of the more positive stories for gold jewellery demand in Q1 this year, with demand in each country rising by 9 per cent. PTI SM
