Mumbai, Nov. 15: Gold demand in India rose 9 per cent to 223.1 tonnes during the third quarter ended September 30, reversing the trends seen earlier this year.
The rise comes at a time global demand fell 11 per cent to 1,084.6 tonnes from 1,223.5 tonnes in the third quarter of 2011. The fall was led by China where demand slipped 8 per cent to 176.8 tonnes from 191.2 tonnes in 2011 because of a negative sentiment surrounding its slowing economy.
Demand for gold has been soft in India as higher prices of the metal coupled with firm inflation deterred discretionary purchases.
According to the World Gold Council’s Gold Demand Trends Report, India was the strongest performing market during the period with a year-on-year growth of 7 per cent for jewellery and 12 per cent for investment demand. India accounted for around 30 per cent of the global consumer demand.
“After a period of broad consolidation during the first few weeks of the quarter, the rupee-gold price rose fairly sharply throughout late August and early September to a record above Rs 32,000 per 10 gram. This fed expectations of further price rises, which-in slight departure to historical precedent, whereby Indian consumers usually react cautiously to sharp price moves, encouraged consumers to buy into the rising trend,” the report said.
While poor rainfall in August had initially curtailed demand, its recovery in the following month improved sentiment. Preparatory purchases also spurred demand during the festive season.
Demand rose 12 per cent for bars and coins to 87 tonnes during the quarter. Demand for jewellery rose 7 per cent to 136.1 tonnes.
In the wake of rising global prices of precious metals, the government today increased the import tariff value of gold and silver marginally to $561 per 10 gram and $1,058 per kg, respectively.
The tariff value, which is released every fortnight, is the base price on which the customs duty is determined to prevent under-invoicing. During October, the tariff value of gold stood at $556 per 10 grams and of silver at $1,039 a kg.