The World Gold Council’s (WGC’s) latest Gold Demand Trends report stated that the Covid-19 pandemic led to consumer demand weakness with total jewellery demand in India for 2020 dipping by 42 per cent at 315.9 tonnes as compared to 544.6 tonnes in 2019. The value of jewellery demand was Rs 133,260 crore, down by 22 per cent from Rs 171,790 crore in 2019. The gold demand for full-year 2020 was 446.4 tonnes compared to 690.4 tonnes in the previous year.
Total investment demand for 2020 was down by 11 per cent at 130.4 tonnes in comparison to 145.8 tonnes in 2019. In value terms, gold investment demand was Rs 55,020 crore, up by 20 per cent from Rs 45,980 crore in 2019. Total gold recycled in India during 2020 was 95.5 tonnes as compared to 119.5 tonnes in 2019. In Q4 2020, the festive period and the ensuing wedding season revived hopes and drew in jewellery demand worth 137.3 tonnes -- the strongest quarter in the year. Investment demand also showed significant resilience, growing 8 per cent to 48.9 tonnes.
On a global level, the pandemic and resultant market lockdowns led to a 14 per cent decline in annual demand to 3,759.6 tonnes. Last year was the first sub-4,000 tonnes year since 2009. In Q4, global gold demand dropped by 28 per cent to 783.4 tonnes, making it the weakest quarter since the global financial crisis in Q2 2008. While jewellery demand volumes are likely to remain relatively subdued as Covid-19 continues to impede the normal functioning of many markets across the globe, mass vaccination programmes and signs of improving economic indicators imply improvement in 2021. WGC said meaningful recovery in India and China will bode well for global demand as we head into 2021.
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