News

Advanced Search

India Boosts Global Gold Jewelry Demand

May 8, 2017 8:45 AM   By Rapaport News
Comment Comment Email Email Print Print Facebook Facebook Twitter Twitter Share Share


RAPAPORT...
Global gold-jewelry demand increased in the first quarter, driven by a reawakening in India, the World Gold Council (WGC) said in its quarterly report on gold trends.

Overall demand for gold jewelry advanced 5% to $18.85 billion, and by volume it crept up 1% to 480.9 tonnes.

However, the market was weak compared with the last half-decade, with demand by volume falling 18% below the five-year average of 587.7 tonnes, the WGC cautioned. The drop in demand was impacted by a 9% rise in the metal’s price between December and March, the council explained.

“Jewelry demand is still in the doldrums, although there are signs of improvement, especially from India, where the gradual remonetization of the economy is supporting the jewelry market,” said Alistair Hewitt, the WGC’s head of market intelligence.

Demand in India jumped 19% to $3.62 billion, with volumes up 16% to 92.3 tonnes. The country’s gold trade benefited from pent-up demand as consumers stopped buying during the liquidity crunch toward the end of 2016, the WGC explained. The Indian government’s demonetization policy in November removed 86% of currency from the market, slashing many consumers’ buying power and denting jewelry sales.

Despite the improvement, the WGC remained cautious about India for the rest of the year because of uncertainty over whether the nation’s goods and services tax (GST) would result in higher or lower taxes for the jewelry sector.

“The combination of the wedding season, the Akshaya Tritiya festival falling on April 28 and 29, and continued remonetization of India’s economy should support gold jewelry demand,” the report said. “However, the market is wary of the forthcoming decision on GST, and this will likely weigh on demand until the government’s final decision, due for implementation in early July.”

China continued to rank as the largest market for gold jewelry. Demand there rose 2% to $6.92 billion, even as volumes declined 2% to 176.5 tonnes.

Meanwhile, overall gold demand – including for jewelry, investment bars and coins, technology and central banks – fell 18% to 1,034 tonnes as higher prices weighed on the metal's investment appeal.

Image: GJEPC
Tags: Akshaya Tritiya, Alistair Hewitt, China, Demonetization, gold, Gold demand, Gold jewelry, goods and services tax, GST, India, Jewelry demand, Rapaport News, WGC, World Gold Council
Similar Articles
Birks 150Birks Gets New Omni-Channel VP
Apr 12, 2018
Canada-based jewelry retailer Birks Group has appointed Aurélie Pépion vice president of omni-channel sales and
Comments: (0)  Add comment Add Comment
Arrange Comments Last to First
© Copyright 1978-2018 by Martin Rapaport. All rights reserved. Index®, RapNet®, Rapaport®, PriceGrid™, Diamonds.Net™, and JNS®; are TradeMarks of Martin Rapaport.
While the information presented is from sources we believe reliable, we do not guarantee the accuracy or validity of any information presented by Rapaport or the views expressed by users of our internet service.