Demand for gold in India for Q1 2023 was at 112.5t down by 17% as compared to the overall Q1 demand for 2022 of 135.5t. Total Jewellery demand in India for Q1 2023 decreased by 17% at 78t compared to Q1 2022 at 94.2t. The total Investment demand for Q1 2023 at 34.4t also decreased by 17% as against to Q1 2022 of 41.3t. Total gold recycled in India in Q1 2023 was 34.8t, up by 25% compared to 27.8t in Q1 2022, while total net bullion imports in Q1 2023 were 134t, similar to Q1 2022, according to the World Gold Council press release.
Somasundaram PR, Regional CEO, India, World Gold Council said: “India’s gold demand in Q1 2023 fell 17% y-o-y to 112.5t following record high and volatile gold prices. This impacted sentiment and gold jewellery demand dropped to 78t from 94.2t in Q1 2022 with little support from the investment side.
Since 2010, barring the pandemic gap, this is the fourth time that Q1 gold jewellery demand fell below 100 tonnes. Sharp rise in gold prices and volatility combined with fewer auspicious days to trigger consumption, has led to many households deferring buying perhaps in anticipation of a downward price correction.
Investment demand, primarily gold bars and coins, too, saw a drop of 17% to 34.4t in Q1 2023 from 41.3t y-o-y. Global factors, primarily US interest rate hikes, pushing up dollar prices and rupee depreciation kept gold prices high, nearly 19% jump over last year. Discussions with trade indicate that purchases are through recycling old gold jewellery and lower unit purchases, which reflect higher volumes on digital gold platforms that enable micro savings in gold. Predictably, there was a sharp jump in recycling up by 25% to 34.8 tonnes in comparison to the same period last year."
"Our forecast for the gold demand is muted for 2023 even as the economic momentum in India remains healthy and the RBI rate hike cycle has paused. The outlook for gold purchases is highly dependent on rupee prices, which show no sign of abating, and which will act as a deterrent, and of course monsoons, though Q4 as always, could throw a surprise. We believe current trends point to less than 800t of demand for 2023," he added.
Aruna Gaitonde, Editor in Chief of the Asian Bureau, Rough&Polished
Somasundaram PR, Regional CEO, India, World Gold Council said: “India’s gold demand in Q1 2023 fell 17% y-o-y to 112.5t following record high and volatile gold prices. This impacted sentiment and gold jewellery demand dropped to 78t from 94.2t in Q1 2022 with little support from the investment side.
Since 2010, barring the pandemic gap, this is the fourth time that Q1 gold jewellery demand fell below 100 tonnes. Sharp rise in gold prices and volatility combined with fewer auspicious days to trigger consumption, has led to many households deferring buying perhaps in anticipation of a downward price correction.
Investment demand, primarily gold bars and coins, too, saw a drop of 17% to 34.4t in Q1 2023 from 41.3t y-o-y. Global factors, primarily US interest rate hikes, pushing up dollar prices and rupee depreciation kept gold prices high, nearly 19% jump over last year. Discussions with trade indicate that purchases are through recycling old gold jewellery and lower unit purchases, which reflect higher volumes on digital gold platforms that enable micro savings in gold. Predictably, there was a sharp jump in recycling up by 25% to 34.8 tonnes in comparison to the same period last year."
"Our forecast for the gold demand is muted for 2023 even as the economic momentum in India remains healthy and the RBI rate hike cycle has paused. The outlook for gold purchases is highly dependent on rupee prices, which show no sign of abating, and which will act as a deterrent, and of course monsoons, though Q4 as always, could throw a surprise. We believe current trends point to less than 800t of demand for 2023," he added.
Aruna Gaitonde, Editor in Chief of the Asian Bureau, Rough&Polished
