Gold imports dip as dealers anticipate slash in duties

Mumbai: Indians consumed lesser quantity of gold during the quarter ended March 2018 as higher prices led to a steep drop in demand for gold jewellery as well as investment in gold.

According to the WGC, the total gold consumed during the quarter stood at 115.6 tonnes, down 12 per cent from the same period last year. The gold jewellery demand slumped 12 per cent to 87.7 tonnes in March quarter while investment demand fell 13 per cent to 27.9 tonnes.

The total imports were also down 50 per cent as retailers and fabricators reduced orders in anticipation of an import duty cut in the Budget that did not materialise.    
“Imports dipped mainly on account of subdued consumer demand, down-stocking following the GST transitional period and also on expectations of duty cut in the Budget,” Mr Somasundaram said.

This was the third weakest quarter in India’s jewellery market in the last 10 years as a depreciating rupee magnified the rise in prices of gold in dollar terms.

Despite the fact that the gold price was relatively stable compared with year-earlier levels, there was a perception of greater volatility among consumers.  
Some responded by holding off from buying jewellery until prices stabilised.