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8
November 2016
India's demand for gold in the third
quarter (July-September) dropped by 28 per cent to 194.8 tonnes, the World Gold
Council said in its report on Tuesday.
The Indian demand was around 271.1
tonnes during the corresponding quarter in 2015.
In terms of value, India's Q3 2016
gold demand was Rs 55,970 crore, a drop of 12 per cent compared to the similar
quarter in 2015 when it stood at Rs 63,660 crore.
"While an elevated price level
was an obvious factor for the drop in volume, other issues appear to have had
an impact on demand -- such as the trade strike following the introduction of
excise duty, the regulation on PAN card for purchases above Rs 2 lakh and the
subdued sentiment on gold buying when the income disclosure scheme was
running," said Somasundaram PR, Managing Director, India, World Gold
Council.
The Total Investment & Insurance Solutions
The World Gold Council has projected
the full year demand to be in the range of 650-750 tonnes. The Total Investment
& Insurance Solutions
"Good monsoon and a drop in the
gold price ahead of Diwali augur well for strong seasonal demand in Q4 that
will likely restore the demand trajectory to normal levels," Somasundaram
said.
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Total jewellery demand in India for
third quarter of 2016 was down by 28 per cent at 154.7 tonnes. Also, total gold
investment demand for the quarter under review fell by 30 per cent at 40.1
tonnes.
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Globally, gold demand reached 993
tonnes in the third quarter of 2016, 10 per cent less than in the similar
period in 2015.
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"Net inflows into
Exchange-traded products (ETPs) helped drive a sharp increase in investment
demand, but this was not enough to offset falls in other areas, notably
jewellery and purchases by central banks," the statement said. The Total Investment
& Insurance Solutions
"We continued to see flows into
gold-backed ETPs in Q3, taking year-to-date inflows at the end of September to
725 tonnes. Institutional investors have looked to hedge against uncertainty
stemming from geopolitical risk, including Brexit, the US presidential race and
the potential impact of elections in France and Germany next year (2017),"
said Alistair Hewitt, Head of Market Intelligence at the World Gold
Council.
"In addition, negative interest
rates -- a theme ever present this year -- continued to underpin institutional
demand," he added. The Total Investment & Insurance
Solutions
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