Gold demand in the September quarter was up 10 per cent at 210 tonnes against 192 tonnes in the same period last year, largely driven by investment demand.

Jewellery demand was up 7 per cent at 156 tonnes (146 tonnes) and investments increased 20 per cent to 54 tonnes (45 tonnes). Demand for bars and coins jumped 20 per cent to 54 tonnes (45 tonnes), according to the Gold Demand Trend report released by the World Gold Council on Tuesday.

Gold imports rose 20 per cent to 220 tonnes (184 tonnes) while gold recycling was up 19 tonnes (16 tonnes). Gold prices were up 16 per cent year-on-year in the September quarter to ₹51,260 per 10 grams but compared to June quarter price of ₹52,192, it was down 2 per cent.

In terms of value, gold demand was up 28 per cent at ₹1.88 lakh crore (₹1.47 lakh crore) while jewellery and investment demand increased 24 per cent and 40 per cent to ₹1.39 lakh crore (₹1.12 lakh crore) and ₹48,850 crore (₹34,900 crore).

Given the global economic uncertainty, central banks’ gold buying has hit a new high of 800 tonnes so far this year, though it fell 37 per cent in the September quarter to 337 tonnes (459 tonnes).

RBI joined other central banks by buying 19 tonnes of gold in the quarter. WGC expects central banks’ gold buying spree to continue in the fourth quarter.

China back on top

The People’s Bank of China regained the title of the largest buyer globally, increasing its gold reserves by 78 tonnes in the quarter. Since the start of the year, the PBoC has increased its gold holdings by 181 tonnes to 2,192 tonnes (equivalent to 4 per cent of total reserves).

Somasundaram PR, Regional CEO (India), World Gold Council said going ahead, gold demand in Q4 will depend on prices and is expected to be lower than last year as prices are expected to stay firm, given the geopolitical issues.

Jewellery demand in the Southern region was much better than in other parts of the country largely due to weak rural sentiments, he added.

WGC has predicted the demand to range between 700-750 tonnes for this year, marginally lower than last year’s 774 tonnes. Moreover, with the demand in last three quarters hovering around 481 tonnes, the overall this year demand is expected to be lower than last year’s level as prices are unlikely to drop drastically to boost demand, he said.

Meanwhile, global gold demand declined by 6 per cent to 1,147.5 tonnes during the third quarter of 2023 on sluggish demand for bars and coins and from central banks.

Gold demand in China was up marginally at 247 tonne (243 tonne) in September quarter.