India’s gold market in May: retail demand collapsed amid COVID-induced lockdowns

Summary

  • The domestic gold price ended 5.1% higher in May at Rs48,993/10g 
  • Retail demand collapsed amid COVID-induced lockdowns in the country 
  • Indian official imports slowed and the local market flipped to discount 
  • Monthly inflows into gold ETFs slowed as higher returns lured investors towards the equity market. Total holdings for Indian gold-backed ETFs (gold ETFs) reached 33.2t by the end of May; a net inflow of 0.1t (Rs2.9 bn; US$39mn)
  • The Reserve Bank of India (RBI) added 0.9t of gold to its reserves in the month increasing its total gold reserves to 696.2t.
     

Posted 2 years 4 months ago

India’s gold market in August: Indian imports hit nine-month high but retail demand remained weak

Demand for safe haven assets and strong year-to-date performance, coupled with the price correction likely seen by investors as a buying opportunity, supported gold ETF flows. On the other hand, retail gold demand weakened as consumers waited on the sidelines following a sharp correction in the domestic gold price amid rising COVID-19 cases.

Posted 3 years 1 month ago

India’s gold market in June: Jewellery demand improved further, continued inflows into Indian gold ETFs

Jewellery demand improved further in the month but failed to recover completely due to recurring lockdowns, lower number of weddings and lack of auspicious days in the month. Bullish gold price momentum and safe-haven demand lured investors towards gold ETFs. Total holdings for Indian gold ETFs reached to 24t in June.

Posted 3 years 3 months ago

Wedding season revives gold demand in November a little – but the market is still soft

Summary

  • Indian gold imports were 62.3t in October 2019 – 11% lower than the same month last year
  • The domestic gold price declined by 2% in November, ending the month 20% higher than the end of 2018
  • With the onset of the wedding season in November, the local market was back in premia of US$1/oz on 6th November after trading at discount for more than five months, but lower than expected wedding volumes pushed the market back into discount by end of November
  • Late withdrawal of the monsoon, with heavy rainfall in several states of India, damaged kharif crops, leading to more than 50% of kharif crops trading below the minimum support price (MSP) due to high moisture content and little progress in procurement of crops from government . This will impact rural income in Q4 2019

Posted 3 years 10 months ago