Indian Gold Jewellery Demand Surges Ahead of Anticipated GST Rate Hike

SEATTLE (Scrap Monster): The gold jewellery demand in India surged higher by almost 20% during the past couple of days. The low domestic gold prices in recent times coupled with fears about hike in the Goods and Service Tax (GST) on gold are cited as the key triggers for the demand surge.

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The domestic gold prices in India have been on a declining trend, in line with the trend in global gold prices. The prices for the yellow metal have declined by almost 3.6% from its peak in early-September this year. According to market data, gold is currently trading at its lowest level in almost two months. The gold price decline has revived gold jewellery demand in the country. Also, the trade circles anticipate a hike in GST on gold from current levels of 3% to 5%. The decision is likely to be declared in the GST Council meeting scheduled for December 18^th.

Meantime, the latest data published by the World Gold Council (WGC) suggests that overall gold jewellery demand in the country has declined by 5.3% to 395.6 tonnes during the initial nine-month period this year.