The loans will go mostly to the import of machinery rather than working capital, according to a recent article from The Economic Times.
US Gold Jewelry Demand ‘Relatively Resilient’ in Q4
Pent-up demand and money diverted from travel and dining out helped boost demand for gold jewelry at the end of 2020.
According to the World Gold Council’s recently released Gold Demand Trends report for the fourth quarter and full-year 2020, demand for gold jewelry in volume terms was down just 1 percent year-over-year in Q4.
In value terms, demand hit a quarterly record of $2.9 billion due to high gold prices.
The gold price topped $2,000 an ounce in August and finished the year with a cumulative average of $1,769.64. Early into 2021, the gold price remains high, hovering around $1,800 per ounce as of press time.
WGC described Q4 U.S. demand as “relatively robust,” noting that the fourth quarter benefited from pent-up demand from previous quarters.
In addition, money that’s usually spent on travel and dining out, which are severely limited by the ongoing pandemic, was diverted to gold jewelry, which remains on-trend for fashion pieces as well as in bridal.
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For the full year, the council said its data shows gold jewelry demand in the U.S. was down 10 percent, driven by the impact COVID-19 had on consumer income and sentiment.
(WGC noted that U.S. demand figures could be subject to “greater-than-normal revisions” going forward, due to varying levels of uncertainty in the data due to COVID-19 disruptions.)
Data from The Edge Retail Academy shows that the number of units of gold jewelry sold dropped 7 percent year-over-year in 2020, though gross sales were up 2 percent and the average amount of each sale rose 10 percent.
Globally, gold jewelry demand was down 13 percent in the fourth quarter and 34 percent on the year.
All markets posted steeper declines than the U.S.
Precipitous drops in demand in India and China, the two largest consumers of gold in the world, were the main drivers behind the decline.
The World Gold Council said demand in India fell 42 percent year-over-year in 2020, and was down
In Europe, gold jewelry demand fell 21 percent and it was down about 30 percent in the Middle East and Turkey.
Overall global gold demand, including use of the metal for technology and as an investment vehicle, dropped 28 percent in the fourth quarter, the weakest quarter since 2008, when the world was the midst of the global financial crisis.
For the full year, demand was down 14 percent to 3,759.6 tons, marking an 11-year low.
Total annual gold supply fell 4 percent year-over-year to 4,633 tons, the biggest drop since 2013.
The World Gold Council said the coronavirus-related disruption to mine production—which was seen in the diamond industry as well—is largely to blame, though it was offset somewhat by a marginal increase in recycling to 1,297.4 tons.
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