Mumbai Nov 19 (UNI) The demand for yellow metal in India reached an all time high during quarter three of 2008 at Rs.30,600 crore, a 66 per cent increase over the corresponding period last year.
The Latest Gold demand trends, issued by the World Gold Council (WGC) here, saw investors hogging gold as a safe haven in the troubled money market and jewellery buyers returning to market due to soft gold prices.
In tonnage terms, demand increased to 250 tonnes in Q3 2008 from 190 tonnes in Q3 2007, which is a 31 per cent increase, a release from the Council said today.
The demand for gold jewellery reached 178 tonnes, a rise of 29 per cent, despite a deteriorating economic situation creating a greater squeeze on consumer spending. In currency terms, this equated to a rise of 78 per cent, from Rs.12,300 Cr to Rs.21,900 Cr.
After a sluggish start to the quarter, gold jewellery demand surged driven by rural economic boom and urban consumers wanting to safeguard their investments. Much of India experienced a good monsoon rainfall, which resulted in a 'feel good' factor boosting rural spending on gold during the festive season.
The data, compiled independently for WGC by GFMS Limited, shows investment demand for gold was similarly boosted by the pullback in the gold price during the third quarter. Purchases of gold bars and coins by retail investors amounted to 71 tonnes, the second highest quarter on record and equivalent to a rise of 36 pc over the 52.3 tonnes consumed in the third quarter of 2007.
At Rs 8,700 Cr, the growth in value is 72 per cent as compared to that of previous year of Rs 5,073 cr. In certain areas, supply of small bars for retail customers reportedly dried up in the face of such unprecedented demand.
WGC Managing Director Ajay Mitra described the quarter as an outstanding one for demand in India, the world's largest consumer of gold. ''Gold's universal role as a store of value has shone through during this quarter helping attract investors and consumers to all forms of gold ownership'' he added.
UNI VK OBB NP1848