Metals Focus (Great Britain) is one of the world leaders in the field of consulting in the precious metal market. Analysts of the company prepared a study of the gold market in India, which was conducted in more than ten cities of the country.
As it became known, in the second half of 2021, sales of gold and silver significantly increased in India. This was influenced by the following circumstances: the decline in the incidence of coronavirus and the easing of quarantine restrictions. Investment products and jewelry were in special demand among the population.
The increase in jewellery purchases in the second half of 2021 was driven by delayed demand from individual shoppers who had to cancel weddings in 2020 and the first half of 2021. However, the decline in gold prices played an equally important role in this context. Many jewelry merchants have significantly increased their inventory of products in warehouses this year - this figure has increased by about 5-10% on an annual basis.
Importantly, demand has also increased significantly for investment products in gold. The pandemic has strengthened the Indian population's commitment to yellow metal as rising prices for it in 2020 have helped many people through crisis times. They could use the yellow metal as collateral for loans.
The growth in demand for gold from the Indian population, along with the improvement in the general economic situation in the country, contributed to an increase in the average price of precious metal by 15-20% compared to the price that was on the market during the pre-pandemic period.
According to the results of the study, silver also benefited from a noticeable improvement in the situation in the country over the past 4 months. The volume of purchases of gray metal began to grow after the lifting of strict quarantine restrictions and a decrease in the price of precious metal. However, Metals Focus experts predict that gray metal sales will not reach the level observed in the period preceding the pandemic.
Analysts at "Metals Focus" expect India's gold and silver sales to increase on the back of economic growth, relatively stable precious metal prices and delayed demand.