In Love Over Gold, India Faces China Challenge

China’s demand for gold for jewellery was estimated at 476 tonnes, compared with 396 tonnes from India

- Tina Edwin

The consumer demand for gold from India in the July-September quarter fell about 32 per cent from a year ago to 124 tonnes, its lowest level in 13 quarters.

Demand was hurt by elevated prices of the yellow metal, dampened consumer sentiment due to the economy slowing, and an increase in import duty in July from 10 per cent to 12.5 per cent. India was not the only country to experience a decline in demand for gold, global consumer demand shrank 28 per cent in that quarter to 611 tonnes, from a year ago, and China’s demand contracted 25 per cent, the latest quarterly update of the World Gold Council reported.

At that level, consumer demand for gold was at its lowest in any quarter of the current decade, quarterly demand data beginning from 2010 published by the WGC show. More significantly, China has firmly displaced India as the world’s leading consumer of gold.

Here are five significant trends that have emerged in the demand for gold.

1. Sharper fall in India