Gold & Silver

Gold demand falls due to volatile prices, economic uncertainties: WGC

PTI Mumbai | Updated on April 30, 2020 Published on April 30, 2020

Jewellery demand and gold investment demand also declined in the first quarter

Gold demand in India fell 36 per cent in the January-March quarter of this year to 101.9 tonne due to volatile prices, economic uncertainties and coronavirus-induced nationwide lockdown towards the end of the quarter, according to a report.

Jewellery demand and gold investment demand also declined in the first quarter and going ahead it could be a “challenging year” unless the industry is able to get the artisans and reorganise the supply chain in quick time.

According to the World Gold Council’s (WGC) Q1 Gold Demand Trends report, in terms of value India’s the first quarter gold demand fell 20 per cent to ₹37,580 crore, compared to ₹47,000 crore in the same period of 2019.


Gold prices jumped 25 per cent to an average of ₹36,875 per 10 grams, without customs duty and taxes, during the first quarter of this year, compared to an average of ₹29,555 in the same period of 2019, WGC India Managing Director Somasundaram PR told PTI here.

“Indian gold demand in the first quarter of 2020 dropped due to a combination of factors such as high and volatile prices, economic uncertainties and towards the end of the quarter, severe logistical freeze following lockdown,” he added.

Sharp drop in jewellery demand

Meanwhile, total jewellery demand during the quarter also declined by 41 per cent at 73.9 tonne compared to 125.4 tonne in January-March of 2019. In value terms, jewellery demand saw a drop of 27 per cent at ₹27,230 crore as against ₹37,070 crore in the same quarter of 2019.

“Wedding demand during the first few weeks of the quarter did appear to bring in some seasonal cheer. However, later developments, more particularly since the beginning of March, disrupted the market and consumer confidence, resulting in a sharp drop in jewellery demand by 41 per cent,” Somasundaram said.

The total investment demand in the first quarter of 2020 was down by 17 per cent at 28.1 tonne. In value terms, however, gold Investment demand was up by 4 per cent on a year-on-year basis at ₹10,350 crore. “Investment demand, though lower by 17 per cent at 28.1 tonnes, was relatively better as sentiments towards equities turned negative and investors turned to gold’s liquidity and safe haven status,” he said.

Published on April 30, 2020

A letter from the Editor

Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!


Support Quality Journalism
This article is closed for comments.
Please Email the Editor
You have read 1 out of 3 free articles for this week. For full access, please subscribe and get unlimited access to all sections.