by Staff Writers
Mumbai (AFP) Feb 15, 2013
Global demand for gold fell last year in its first tumble since 2009 as demand in leading market India slid, narrowing the gap with second-biggest buyer China, the World Gold Council said Thursday.
Demand for the precious metal was 4,405.5 tonnes for the full year, down 3.85 percent from 4,582.3 tonnes a year earlier, the WGC report said.
But in value terms, gold demand in 2012 increased to a record high of $236.4 billion, as the average price for the precious metal rose.
A decline in consumer demand offset an increase in demand from institutional investors and central banks, the report said.
For the full year, India's gold demand fell 12 percent from a year earlier -- despite improved demand in the final quarter -- to 864.2 tonnes.
In China, demand for the full year was flat at 776.1 tonnes.
World jewellery demand, which accounts for 44 percent of total demand, slid by three percent in 2012 to 1,908.1 tons, hit by softer appetite in the first half of 2012, the data showed.
The team of WGC analysts, who prepared the report, forecast that gold jewellery demand could soften in 2013 in volume terms.
But investment demand is likely to exceed historical averages due to its role "as a store of wealth", the report added.
In the October-to-December quarter, global gold demand rose only four percent year-on-year to 1,195.9 tonnes, worth an estimated value of $66.2 billion, WGC said.
Demand for gold in India, the world's largest consumer and importer of the yellow metal, improved in the last quarter after being sluggish in previous quarters.
India's fourth-quarter gold demand jumped 41 percent to 261.9 tonnes from a year earlier but in China it climbed just 1.45 percent to 202.5 tonnes, due to "the effects of slowdown in the domestic economy," the report showed.
"The Indian market thrived during the wedding season and festive fourth quarter period," WGC said. Indian gold purchases traditionally spike during the religious festival and wedding season.
In addition, bullion dealers stocked up, fearing a hike in the import duty on gold by the Indian government.
Last month, India raised the duty on the precious metal by 50 percent to six percent after doubling it in 2012.
India has been seeking to deter vast gold imports that are one of the main contributors to the deficit in the current account, the broadest measure of trade.
The deficit hit a record $22.3 billion, or 5.4 percent of GDP, in the July-September quarter, as imports outpaced exports.
Global Trade News
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