BackGold demand continues to slide in India
Total demand for gold declined 39% in the June quarter to 204.1 tonnes, the steepest drop in over two years
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Gold prices have declined 15% in India compared with a year ago, but investment demand for the metal continues to remain tepid. Total demand for gold declined 39% in the June quarter to 204.1 tonnes.
The drop was the steepest in over two years, with investment demand for bars and coins declining 67% and jewellery demand also continuing to slide for the fourth consecutive quarter, down 18%, according to a World Gold Council report.
While the ban on coin imports and high import duty of 10% continued to weigh on investment demand in India, the asset class has been out of favour for other reasons as well—investors have been flocking into other asset classes such as equity.
“Investors are finding other financial assets such as fixed income and equities more rewarding as real interest rates have become positive in the past year, for the first time in three to four years," said R. Sivakumar, head (fixed income and products) at Axis Asset Management Co. Ltd.
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