Gold demand in India witnessed a 5% on-year rise at 802.8 tonnes in 2024 supported by reduction in import duty, and purchases related to weddings and festivals, and going ahead consumption of the yellow metal in 2025 is likely to be between 700-800 tonnes, according to the World Gold Council.

The World Gold Council (WGC) in a report on Wednesday (Feb. 5, 2025) said gold demand in the country in 2024 stood at 802.8 tonnes, as against 761 tonnes in 2023.

The total gold demand value went up by 31% at ₹5,15,390 crore in 2024, compared to ₹3,92,000 crores in 2023.

“Our outlook for 2025, gold demand is between 700-800 tonnes. It is expected that gold jewellery demand will recover due to wedding-related purchases, provided there is some level of price stability,” WGC Regional CEO, India, Sachin Jain told PTI.

It is pertinent to mention here that the gold price touched multiple record highs over the past year.

According to the All India Sarafa Association, gold prices extended the rally for the fifth straight session and rose ₹500 to hit a fresh peak of ₹85,800 per 10 grams in the national capital on Tuesday (Feb. 4, 2025) amid robust demand from jewellers and retailers.

In this year, gold has surged ₹6,410 or 8.07% to ₹85,800 per 10 grams from ₹79,390 per 10 grams on January 1.

The WGC’s 2024 Gold Demand Trends report stated that during the fourth quarter (October-December) demand was flat at 265.8 tonnes, which is similar to 266.2 tonnes in the same period of 2023.

Meanwhile, in 2024, the jewellery demand declined by 2% to 563.4 tonnes in 2024, compared to 575.8 tonnes in 2023, said.

“The total jewellery demand, in terms of volume, decreased by 2% to 563.4 tonnes in 2024, despite the gold price reaching multiple record highs.

“This indicates the resilience of gold jewellery demand in India and highlights the effect of the duty cut in July as well as India’s stronger economic growth compared to many other markets,” Mr. Jain said.

He said that many consumers purchased gold jewellery in the late third quarter when the duty cut mitigated much of the recent price increase.

Gold prices resumed their upward trend after the July duty cut, and a subsequent correction in November attracted investors seeking lower-priced purchases, he added.

Nonetheless, Jain said, the value of gold demand during 2024 increased by 22%, illustrating the ongoing demand for gold and supported by the rise in gold prices throughout the year.

“Total gold investment went up by 29% in 2024, at 239.4 tonnes — the highest since 2013, compared to 185.2 tonnes in 2023, reinforcing gold’s status as a safe-haven asset,” Mr. Jain stated.

Gold recycling last year saw a decline of 2% at 114.3 tonnes from 117.1 tonnes in 2023.

Further, gold imports in India in 2024, decreased by 4% to 712.1 tonnes as compared to 744 tonnes in 2023.

“There was consistent ETF demand throughout the year, and the festival period of Dhanteras and Diwali in October/November stimulated buying in the final quarter. This was further enhanced in major metropolitan cities by e-commerce platforms offering rapid delivery of small gold investment bars and coins,” he noted.

Further, he said, the Reserve Bank of India was a significant purchaser in 2024, acquiring 73 tonnes, more than four times its gold purchases of 16 tonnes in 2023.

Additionally, it is anticipated that the trend of robust gold investment demand will continue, with retail investors showing growing interest in gold ETFs, digital gold, and coins and bars, he added.

The World Gold Council expects India’s gold demand to rise in 2024 despite higher prices. File
| Photo Credit: Reuters

MUMBAI

India’s gold demand is expected to be subdued in the first quarter of 2024 due to lower jewellery sales, but annual demand is anticipated to rise as consumers adjust to higher prices, the World Gold Council (WGC) said on January 31.

Higher purchases in the world’s second-biggest gold consumer could support prices which are trading near record highs. However, the rising demand for imports could widen India’s trade deficit and put pressure on the rupee.

India’s gold demand has been stuck between 700 and 800 metric tons in the past five years, but it is expected to break out of this range and rise to between 800 and 900 tons in 2024, Somasundaram P.R., CEO of WGC’s Indian operations told Reuters. “Given the fact that high prices have now been absorbed and economic growth is robust, demand is resetting its base to 800 to 900 tons,” he said.

Indian gold demand fell 3% in 2023 from the prior year to 747.5 tons, the lowest since 2020, as prices rallying to a record high curtailed jewellery demand, the WGC said in a report published on Jan. 31. Switzerland, the United Arab Emirates, Peru, and Ghana are leading gold suppliers to India.

In the March quarter, demand is expected to stay low due to fewer auspicious wedding days, the WGC said. Weddings are a major driver of gold purchases in India, with the yellow metal in the form of jewellery being a crucial part of a bride’s attire and a popular gift from family and guests.

Indian gold consumption in the October-December quarter fell 4% to 266.2 tons, as a drop in jewellery demand overshadowed higher sales of coins and bars for investment purposes, the WGC said. Meanwhile, gold smuggling into India gained momentum to approximately around 130 tons from around 110 tons a year ago, Mr. Somasundaram said, due to prices reaching record highs.

The Commerce Ministry has backed a long-standing demand from the jewellery industry to reduce import tariffs on gold bars, Government and industry officials said, amid concern the duties were further harming the India’s faltering jewellery exports.

Pakistan’s gold demand fell 11% to 11.6 tonne during the third quarter of 2023 from 13 tonne in the year-ago period, while Sri Lanka’s gold demand rose substantially to 2.4 tonne from 0.3 tonne. (Representational image only.)
| Photo Credit: Reuters

Global gold demand declined by six per cent to 1,147.5 tonne during the third quarter of 2023 on sluggish demand for bars and coins and from central banks, World Gold Council (WGC)’s latest report said on October 31.

Gold demand in China, the world’s largest gold-consuming nation, rose marginally to 247 tonne in Q3 this year from 242.7 tonne in the year-ago period.

Whereas gold demand in India, the world’s second-largest gold-consuming nation, rose 10% to 210.2 tonne against 191.7 tonne a year ago.

In the case of neighbouring countries, Pakistan’s gold demand fell 11% to 11.6 tonne during the third quarter of 2023 from 13 tonne in the year-ago period, while Sri Lanka’s gold demand rose substantially to 2.4 tonne from 0.3 tonne.

According to the report, the world jewellery demand declined by one per cent to 578.2 tonne in the third quarter of this year from 582.6 tonne in the year-ago period.

“The environment of high gold prices and economic uncertainty was a key driver of the year-on-year decline, particularly in some of the more price-sensitive markets in Asia and the Middle East,” the report said.

“China saw a disappointing third quarter as consumers were reluctant to buy in the face of the very high local price premium, raising expectations of a price correction,” it said.

“Jewellery demand has continued to hold up relatively well in spite of the very high price environment this year. But risks to this sector remain, given the precarious economic scenario in many markets and continued pressure on consumers from the cost of living crisis,” it added.

As per the report, global bar and coin demand fell 14% to 296.2 tonne during the third quarter from 344.2 tonne a year ago.

“The year-on-year decline in bar and coin investment in the third quarter was due to certain pockets of lower demand, notably in Europe (Germany in particular), the U.S., Turkey, Australia and Iran,” it said.

“Investment demand for gold ETFs, bars and coins was anaemic in Q3. At 157 tonne, investment was only half of its five-year quarterly average of 315 tonne,” the report noted.

Gold demand for usage in technology fell three per cent to 75.3 tonne from 77.3 tonne because demand in the electronics industry remained relatively weak, although some sectors showed signs of recovery.

According to the report, central banks’ gold buying also declined 27% to 337.1 tonne in the third quarter from 458.8 tonne in the year-ago period.

“Added to the record-breaking H1 total, year-to-date, the net purchases now stand at 800 tonne. Looking ahead, central bank demand is on course for another strong annual total,” it said.

“The total gold supply increased six per cent to 1,267.1 tonne during the third quarter from 1,190.6 tonne a year ago. Mine production hit a record 971 tonne in Q3; recycled gold rose year-on-year to 289 tonne in the said period,” the report added.