NEW DELHI: India could see a significant rise in gold demand in the Q4 of 2021, with the World Gold Council anticipating it to be the busiest gold-buying season since the start of Covid.
“Looking ahead with restrictions being gradually lifted across the country, retail demand is bouncing back to pre-Covid levels. With the upcoming festive and wedding season, there is all the more enthusiasm towards gold demand, and we anticipate it to be the busiest gold-buying season since the start of covid,” Somasundaram PR, Regional CEO, India, World Gold Council (WGC), said in a statement.
Demand for gold in India was up by 47% at 139.1 tonne in the third quarter of 2021 as compared to overall demand in the year-ago period at 94.6 tonne.
The jump in gold demand in the third quarter reflects a combination of low base effect and return of positive trade and consumer sentiments, according to PR.
“This is primarily driven by what appears to be a firm grip on the pandemic with higher vaccination rates and falling infection rates, leading to a strong rebound in economic activity,” he said.
The gold jewellery demand in India increased by 58% to 96.2 tonne, owing to softer gold prices.
PR further noted that trade activity witnessed during various buyer-seller meets and anecdotal feedback from manufacturers indicate that this Q4 festive season could be the best in several years, with strong imports (255.6 tonne, an 187% increase over last year) much ahead of Q3 demand.
A 50% drop in gold recycling at 20.7 tonne also underlines strong consumer intent to hold gold rather than sell it, he said, adding, “While we have not made any forecast for the rest of the year, barring any unexpected twist in tale, we could see a sharp spike in demand in Q4 2021.”