Jewellery demand drops by 12% in Q1
Indian jewellery demand saw a sharp downturn in Q1 2018
According to the data & details -India Demand Statistics for Q1 2018, released by WGC, demand for gold in India for Q1 2018 was at 115.6 tonnes down by 12% as compared to overall Q1 demand for 2017 of 131.2 tonnes.
India’s Q1 2018 gold demand value was Rs 31,800 crores, a fall of 8% in comparison with Q1 2017 of Rs 34,440 crores. Total Jewellery demand in India for Q1 2018 was down by 12% at 87.7 tonnes as compared to Q1 2017 at 99.2 tonnes.
The value of jewellery demand in Q1 2018 was Rs 24,130 crores shows a drop of 7% over Q1 2017 of Rs.
26,050 crore. While at the Investment front demand for Q1 2018 was down by 13% at 27.9 tonnes in comparison with Q1 2017 of 32 tonnes.
Looking at value terms, gold investment demand in Q1 2018 remained Rs. 7,660 crores by registering a fall of 9% over Q1 2017 of Rs. 8,390 crores. Total gold recycled in India in Q1 2018 was 14.1 tonnes also a case of drop & that dropped by 3% compared to 14.5 tonnes in Q1 2017.
According to Somasundaram PR, Managing Director, India, World Gold Council, “Local gold price rises led to the second weakest quarter for jewellery demand in almost 10 years. After the strongest Q4 on record in 2017, Indian jewellery demand saw a sharp downturn in Q1 2018, falling 12% year-on-year to 87.7t.
A substantial drop in the number of auspicious wedding days during the period compared with Q1'17, could
be a factor for muted demand as consumers made less wedding-related purchases. Imports were also down 50%
year-on-year, in anticipation of an import duty cut in the Union Budget that did not materialise.
The positive sentiment following the announcement in the Union Budget about an impending gold policy to make gold an asset class will boost the industry momentum to get more organised and transparent and build a strong case for a central gold body under the gold policy.
Trade activity resumed positively during Akshaya Tritiya demonstrating the resilience of the industry. Policy focus on doubling farm income and ease of business under GST augur well for the gold industry in 2018 and the medium term. New ways of buying gold through digital platforms are catching up quickly; this will not just promote ease of savings but bring about a mindset change, thereby enhancing acceptability of centrally vaulted gold - which underpins any attempt to mainstream gold including Gold Monetisation Scheme.
For year 2018, full year gold demand expectations for India is in the range of 700 – 800 tonnes!
