Gold jewellery demand retained its sparkle in the third quarter of 2021, recording a year-on-year increase of 33 per cent to 443 tonnes on the back of strong growth in China, India and the Middle East, the World Gold Council (WGC) revealed. 

Amid solid recovery, the figure is still 6 per cent below pre-pandemic 2019 and 12 per cent behind the five-year quarterly average, data from WGC’s Gold Demand Trends report for Q3 2021 showed. In value terms, demand was up 25 per cent to US$25.5 billion – the highest for a third quarter in eight years.

“In Q3, gold jewellery demand was driven by economic recovery and improving consumer sentiment, continuing the trend from the first half of the year. Year-to-date, global jewellery demand is almost 50 per cent higher than the same period in 2020,” noted WGC.

Despite growth in China, India and the Middle East alongside steady recovery in the West, Asian markets including Vietnam, Malaysia and Thailand continued to experience Covid-related disruptions.

China’s gold jewellery demand rose 32 per cent to 157 tonnes year on year in Q3, owing to more stable gold prices and higher disposable income. Specifically, bargain hunting due to a sharp drop in prices, festival-led growth as well as a per-gram pricing scheme lifted Q3 demand.

“The full-year outlook for China’s jewellery demand is positive, but not without challenges,” said WGC. “Should recent power rationing measures continue, this would likely create manufacturing bottlenecks. In view of this, we remain cautiously optimistic about China’s gold jewellery demand in the coming months.”

Jewellery demand in India meanwhile climbed approximately 60 per cent year on year, due to robust pent-up demand, lower gold prices and overall economic rebound. 

“A higher number of auspicious wedding days bodes well for jewellery demand for the remainder of the year, especially because the good monsoon should support rural incomes. But the potential for further waves of Covid, which may require further lockdowns, is an ever-present threat,” the council noted.

The Middle East for its part witnessed year-on-year growth in Q3 jewellery demand due to lower and relatively stable gold prices and easing of Covid restrictions. Improving tourist arrivals, especially from India, also aided recovery, WGC revealed.