By Rajendra Jadhav
MUMBAI, Jan 31 (Reuters) - India's gold consumption in
2022 fell 3% from a year earlier, as a rally in local prices to
near-record highs curtailed bullion demand during the key
December quarter, the World Gold Council (WGC) said on Tuesday.
Lower consumption in the world's second-biggest gold buyer
could weigh on global prices , but help in bringing down
India's trade deficit and support the ailing rupee .
India's gold consumption declined to 774 tonnes last year as
demand dropped 20% to 276.1 tonnes in the December quarter, the
WGC said in a report.
In the March 2023 quarter, gold consumption could improve on
the back of a pick-up in rural demand amid elevated prices of
summer-sown crops and a higher number of auspicious days for
weddings, the council said.
Two-thirds of India's gold demand usually comes from rural
areas, where jewellery is a traditional store of wealth.
Gold is an essential part of the bride's dowry in India and
also a popular gift from family and guests at weddings.
"Demand will, however, continue to face headwinds from the
higher domestic gold price and persistently high rural
inflation," the WGC said.
Local gold prices hit an all-time high of 57,149
rupees ($699.63) per 10 grams in January.
The rally in gold prices prompted some investors to sell
gold, while some consumers exchanged old gold jewellery for new,
which lifted gold recycling in India by 30% to 97.6 tonnes in
2022, the WGC said.
($1 = 81.6850 Indian rupees)
(Reporting by Rajendra Jadhav; Editing by Subhranshu Sahu)
Messaging: rajendra.jadhav.thomsonreuters.com@reuters.net))
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