Overall demand stood at a record low of 63.7 tonnes, down from 213.2 tonnes, lowest since 2010. Jewellery demand was at 44 tonnes, a drop of 74%, from 168.6 tonnes, registered in the same quarter of the previous fiscal, data from World Gold Council showed.
Chennai: Gold demand dropped by 70% year on year for the quarter ended June, as surging prices and poor consumer sentiments have kept jewellery purchase at bay, despite the period having auspicious occasions like Akshaya Tritiya.
Overall demand stood at a record low of 63.7 tonnes, down from 213.2 tonnes, lowest since 2010. Jewellery demand was at 44 tonnes, a drop of 74%, from 168.6 tonnes, registered in the same quarter of the previous fiscal, data from World Gold Council showed. It is also the lowest Q2 demand seen since 2010.
The lowest annual demand for gold was 415 tonnes in 1994. 2020, so far, has seen a demand of 165.6 tonnes.
In terms of value, the demand was at Rs 26,600 crore, down by 57% compared to Rs 62,420 crore during Q2 of CY 2019. As a result, total gold imports in India in Q2 2020 sank 95% 11.6 tonnes during the quarter compared to 247.4 tonnes in Q2 2019
“The quarter was marked by lockdown and high prices. There was a lot of fear and weddings, which usually contribute to a chunk of the demand, were postponed. However, there was a little increase in buying during the phases when the lockdown was relaxed. This would mean that the demand would go up once Covid situation improves,” said PR Somasundaram, MD, WGC India.
WGC did not forecast the full year demand citing unpredictable conditions.
Jewellers too saw a drop in demand in the quarter. April was a complete washout because of the total lockdown. May and June saw Covid restrictions easing, but the consumer sentiments were largely subdued.
“There was virtually no business in April. May saw 30% of usual business and June saw less than 20%, because prices were high and customers were waiting for prices to drop,” said N Ananthapadmanabhan, MD, NAC Jewellers. Titan in a regulatory filing earlier this month said that May’s revenue stood at 20% of the same period from the previous year and June saw 70% They also say the current quarter witnesses subdued demand thanks to record high prices. A gram of 22 carat gold was priced at Rs 5,100 on Thursday.
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