Gold demand in the September quarter was up 14 per cent to the pre-Covid level of 192 tonnes against 168 tonnes logged in the same period last year, largely due to fall in gold prices.

Jewellery demand increased 17 per cent to 146 tonnes (125 tonnes) as consumers lapped up their favourite ornaments though gold prices dropped less compared to the international markets due to rupee depreciation against dollar, as per the World Gold Council’s Demand Trend report released on Tuesday.

In value term, overall gold demand jumped 19 per cent to ₹85,010 crore ($10.6 billion) against ₹71,630 crore ($9.7 billion) registered last year.

Jeweller demand

Similarly, jeweller demand value increased 22 per cent to ₹64,860 crore ($8.1 billion) against ₹53,330 crore ($7.2 billion). Investment demand also rose 6 per cent to 45 tonnes (43 tonnes) valued at ₹20,150 crore (₹ 18,300 crore).

Somasundaram PR, Regional CEO (India), World Gold Council said the better-than expected gold demand and strong consumer interest was on back of strong credit expansion with bank loan growth touching a nine-year high by quarter-end.

Recovery in gold jewellery demand was primarily driven by urban India, more specifically southern parts, underpinned by robust economic activities. However, rural demand was impacted by seasonal monsoon and high inflation, he said.

Coin demand

On the other hand, Indian bar and coin demand revived as retail investors responded to gold price drop and weaker equity markets, and festivities around Ganpati and Puja festivals after two years of Covid impact, he added.

While gold prices were up four per cent year-on-year at ₹44,354 per 10 grams it was down 4 per cent when compared sequentially to ₹46,430 recorded in the June quarter.

Similarly, gold prices dipped 3 per cent in dollar terms, while it increased across currencies with Turkey and China registering highest gain of 103 per cent and 21 per cent, year-on-year.

Net gold imports were down 23 per cent at 207 tonne (270 tonne) even as increased 17 per cent when compared on sequential basis of 177 tonne logged in June quarter despite sharp rupee depreciation against dollar making imports a costly affair.