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Gold demand in the second quarter of this year was down 5 per cent at 150 tonnes, against 158 tonnes a year ago, owing to high prices.
In value terms it was up 14 per cent, at ₹93,850 crore (₹82,530 crore), according to the World Gold Council report released on Tuesday.
Jewellery demand decreased 17 per cent to 106 tonnes (128.6 tonnes) while investments climbed 46 per cent at 43 tonnes (29 tonnes).
Despite high prices, gold recycling was down 39 per cent at 23 tonnes against 38 tonnes in Q2 2023.
Imports were up 8 per cent at 197 tonnes (182 tonnes).
Curtailed buying
The average quarterly price was up at $2,338 an ounce ($1,976).
Domestic gold price increased to ₹62,700 per 10 grams (₹52,192) excluding import duty and GST.
Sachin Jain, Regional CEO, India, World Gold Council, said domestic gold demand softened slightly due to record high gold prices impacting affordability and purchases.
Jewellery demand dipped on the back of high prices, the general election, and a severe heatwave. While festivals such as Akshaya Tritiya and Gudi Padwa provided a temporary boost, record high prices continued to dampen consumer sentiment, he added.
‘Enduring value’
The limited recycling indicates limited distress selling, highlighting gold’s enduring role as a store of value in India, said Jain.
Looking ahead, the recent 9 per cent reduction in import duty on gold is expected to revive demand in the July quarter, ahead of the festival season beginning in September and the copious monsoon, he added.
India’s economic outlook, too, remains positive, with strong GDP forecasts and rural sector recovery, which will likely support demand in the second half of the year.
WGC retains its forecast for full-year demand at 700-750 tonnes, he said.
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