Word Gold Council: India's Gold Demand to Keep Rising After Big Jump in 2021

Word Gold Council: India's Gold Demand to Keep Rising After Big Jump in 2021 According to the World Gold Council's 2021 Gold Demand Trends, demand for gold jewelry in India nearly quadrupled year over year in 2021, surpassing pre-pandemic levels to reach a six-year high, with demand for jewelry reaching a record high in the fourth quarter of the year. The World Gold Council stated on Friday that India's gold demand is anticipated to increase further in 2022, potentially widening the trade deficit and putting pressure on the struggling rupee. According to Reuters, Somasundaram PR, regional chief executive officer of WGC's Indian operations, gold consumption is expected to reach a six-year high of 800-850 tonnes this year, up from 797.3 tonnes in 2021. "The year 2021 reaffirmed the robustness of conventional wisdom about gold and has important lessons in revival that will impact policy thinking for years to come," Somasundaram PR, WGC Regional CEO, India, told PTI. "India's gold demand recovered by 79 percent to 797.3 tonnes, owing primarily to an exceptional fourth quarter demand of 343 tonnes, which exceeded even our most optimistic expectation articulated in the third quarter and turned out to be the best quarter in our recorded data series," Somasundaram continued. COVID-19 and its future variations, he added, will be a factor to watch this year, as will gold price swings, given global concerns about inflation, interest rates, and geopolitical developments. Due to the coronavirus outbreak, Indian authorities imposed different limits on wedding celebrations, and some people postponed nuptials until 2022, he said. Gold consumption nearly quadrupled in the December quarter from a year earlier to a record 343.9 tonnes, according to a WGC study released on Friday. Gold is a favorite gift from relatives and visitors during weddings. With local gold prices hovering at $48,000 per 10 grams this week, Somasundaram believes that Indian consumers are more accepting of the present price level. In August 2020, gold prices reached a new high of 56,191 rupees per 10 grams, setting a new high. In terms of value, jewelry demand increased by 96% from Rs 133,260 crores in 2020 to Rs 261,140 crores in 2021. “Investment demand for coins and bars increased by 43% to 186.5 tonnes in 2022, according to the WGC. "As we approach 2022, we expect Indian investment demand to continue strong. Higher inflation expectations and likely rupee weakening as a result of the expanding trade deficit could help it" It was stated. Meanwhile, overall investment demand for 2021 increased by 43% to 186.5 tonnes from 130.4 tonnes in 2020, while demand in value terms increased by 45 percent to Rs 79,720 crores from Rs 55,020 crores in 2020, according to the research. According to WGC data, total gold recycled in India in 2021 decreased by 21% to 75.2 tonnes, down from 95.5 tonnes in 2020. In 2021, India's total gold imports grew by 165 percent to 924.6 tonnes, up from 349.5 tonnes in 2020.