Rising levels of demand for gold jewellery in India and China has buoyed the global demand for gold jewellery
India and China continue to power gold jewellery demand
Posted February 22, 2011 | By Sonia Nair
The high demand for gold jewellery in India and China contributed to a 17 per cent rise in the global demand for gold jewellery last year, but US and European demand continued to flounder.
Global demand rose from 1,760.3 tonnes in 2009 to 2,059.6 tonnes in 2010, according to the Gold Demand Trends released by the World Gold Council.
“Asian consumers continue to drive jewellery demand, particularly in China and India [which together] constituted 51 per cent of global jewellery and bar and coin demand in 2010,” the report explained.
India was the strongest growth market in 2010, said the World Gold Council. Buoyed by demand during the country’s Diwali festival in early November, total gold jewellery demand in India more than doubled, up 69 per cent from 2009.
Demand for gold jewellery across Greater China increased consistently throughout 2010 as its annual demand for gold jewellery increased by 41 per cent, more than double that of 2007.
The report attributed the upsurge in gold jewellery demand in India to a widespread belief by purchasers that gold prices would continue to escalate, which further fuelled demand.
Demand for gold jewellery in Greater China also increased consistently throughout 2010.
The World Gold Council reported that exceptional growth in the gold jewellery demand in Hong Kong, Taiwan, Turkey and Russia further buoyed the global demand for gold jewellery.
In all other Asian markets the demand for gold jewellery recorded double-digit losses both in the fourth quarter and 2010 as a whole, with the exception of Vietnam, which was down 5 per cent year on year although the report said this was “robust” given that domestic gold prices in that country soared 30 per cent last year.
Gold jewellery tonnage demand in Europe and the US continued to be weak in the face of soaring gold prices and a difficult economic environment. In the US it declined by 14 per cent across the year; in the European markets of Italy and the UK, demand by tonnage was down 16 per cent and 14 per cent respectively.
For the second year in a row, hallmarking statistics from the UK assay office show silver articles outnumbered gold. Since 2008, UK gold hallmarking has plummeted 45 per cent.
Overall, the World Gold Council found strong growth in 24-carat gold and modest growth in 18-carat gold.
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