Gold demand falls 16pc in second quarter
India returns as largest buyer as purchasesof the yellow metal fall more steeply in China
Gold demand fell 16 per cent in the second quarter, led by declines in India and China, the World Gold Council said.
Global demand slipped to 963.8 tonnes from 1,148.3 tonnes a year earlier as jewellery purchases fell to the lowest since the fourth quarter of 2012, the London-based council said in a report.
China fell behind India as the largest consumer, with global jewellery buying dropping 30 per cent and bar and coin demand down 56 per cent. Mining companies hedged 50 tonnes as they continued selling future output.
China’s purchases slipped 45pc and those in India fell 18 per cent
Gold slid 28 per cent last year, the most in three decades, as investors lost faith in the metal amid expectations US policymakers would cut stimulus as the economy strengthens. Last year's price drop spurred jewellery, coin and bar demand, particularly in China.
Indian bullion buying has slowed as the government restricted imports to curb a current account deficit.
"Buyers in China and India were waiting to see a price trend develop," said Marcus Grubb, managing director of investment strategy at the council. "It's a market still returning to its fundamentals. It was an exceptional year and quarter last year."
Gold for immediate delivery traded at US$1,312.28 an ounce by in London yesterday for a 9.2 per cent gain this year. It averaged US$1,290 in the second quarter, down 9 per cent from a year earlier and little changed from the first quarter.
Global jewellery demand declined to 509.6 tonnes in the latest quarter, the least since the final three months of 2012. China's purchases slipped 45 per cent and those in India fell 18 per cent, with the countries together accounting for almost 60 per cent of world jewellery consumption. Buying rose 15 per cent in the US and 21 per cent in Britain as consumer confidence rose, it said.