GJ Town India

First time Asia led global gold ETF demand in October’24   Recently World Gold Council (WGC) released Gold ETF Commentary, North America inflows go four-for-four! In the October in review report said, Global physically backed gold ETFs extended their inflow streak to six months, adding US$4.3bn during October.   Continued inflows and the record-shattering gold price lifted global Assets Under Management (AUM) a further 5% to another month-end record of US$286bn. Meanwhile, collective holdings rose 43t to 3,244t. North America once again led global inflows while Europe remained the only region with outflows. Y-t-d global gold ETF demand – led by Asia – has turned positive (+18t) for the first time this year. And so far in 2024, inflows into global gold ETFs have reached US$4.7bn. Supported by recent inflows and the rocketing gold price, total assets under management (AUM) have soared by 33%. All regions other than Europe have experienced inflows ytd.    Asian ...

Gold’s primary function is as a store of value: Report   While gold’s contribution to managing portfolio risk is well established, supported by a large body of work devoted to its hedging characteristics, its contribution to portfolio return is not. Frameworks for estimating gold’s long-term return exist but fall short of a robust approach that aligns with the capital market assumptions for other asset classes. This report, GLTER Gold’s long-term expected return, published by World Gold Council (WGC), sets out such a framework, accounting for gold’s unique dual nature as a real good and a financial asset.   Publications tackling gold’s expected return have generally concluded that gold’s primary function is as a store of value, implying a long-run co-movement of gold with the general price level (CPI). Alternative approaches using risk premia estimations or bond-like structures with embedded options produce similar results. And while existing research is rich in insigh...

  Demand largely driven by investment & wedding related purchases!   Sachin Jain, Regional CEO, India, World Gold Council said, “Buying gold is considered auspicious during Dhanteras, Diwali. From gold jewellery to gold bars, gold coins consumers plan at least a token purchase as a matter of tradition as gold buying is generally believed to herald good fortune, wealth and prosperity and that is visible in the sharp rise in gold buying historically witnessed on this day.   Despite gold prices touching record highs of Rs 79,000/10 grams, anecdotal feedback from Industry indicates a resurgence in gold buying due to various ongoing festivals, with demand largely driven by investment sentiment and wedding related purchases.  The retailers have also invested on new designs and innovative usage of technology to make daily wear, lighter jewellery considering heightened gold prices, to invite consumers to come into the stores. There is also an expectation of incre...

Strong buying interest from jewellery retailer & consumers   Recently, the World Gold Council (WGC) published the Gold Market Commentary, It's always the quiet ones! WGC said, flying high in August! Following a strong monthly increase in July, gold posted another healthy gain in August to finish 3.6% higher at US$2,513/oz.   It also reached a new all-time on 20 August before a very marginal decline into month end. According to our Gold Return Attribution Model (GRAM), gold was pulled higher by a material drop in the US dollar and, to a lesser extent, lower 10-year Treasury yields as the Fed signalled the time had come for rate cuts.   The main identifiable negative contribution came from a momentum factor, the gold return in the previous month, i.e. when high, the following month typically sees a lower return and vice versa. Also of note in August, the significant cut in import duty on gold in India, which took place in late July, has been a shot in the a...

Opaque GJ Trade & Commerce pushes a reluctant Bank financing   All India Gem & Jewellery Domestic Council (GJC) organised first of its kind one-day Gem and Jewellery (GJ) Banking Summit presented by the World Gold Council (WGC) presented at Jio World Convention Centre, Bandra Kurla Complex, Mumbai, on the 18th May 2024.   The Summit was attended by leading Indian government and private bankers engaged directly or indirectly in the gold financing business. The Summit was powered by Yes Bank, Shree Kunj, Kolkata, and supported by Bangalore Refinery, Mukti Gold and Diamond, and Laxmi Diamonds India Ltd.   More than 200 delegates participated in the summit, with experts discussing the financing needs of the industry for a comprehensive growth of the entire value chain from bullion dealers to karigars, craftsman, manufacturers, wholesalers, and retailers. Speakers also deliberated about the risk management facilities available for Indian jewellers, and challenge...

Gold Demand in market India grew by 8% in Q1 2023   Sachin Jain, Regional CEO, India, World Gold Council said, In Q1’24, India's total gold demand was 136.7 tonnes, up by 8% in comparison to 126.3 tonnes in Q1 2023 reaffirming Indians enduring relationship with gold. Gold jewellery demand was 95 tonnes, 4% above the comparatively weak Q1’23.    India’s continued strong macroeconomic environment was supportive for gold jewellery consumption even though prices reached a historic high in March leading to a slowdown in sales as the quarter ended.    Q1’24 also saw healthy levels of gold bar and coin demand in India, up 19% y/y at 41t. This was on a par with  Q1’22, which was itself the strongest first quarter since 2014. The price correction in February sparked investors’ interest, with anticipation of a rebound driving purchases.    As the price rallied to successive record highs, investors remained bullish, contributing to the robust demand....

Gold ETFs March remained 21% lower MoM   In the March in review of Global physically backed gold ETFs for World Gold Council (WGC) said, Outflows from global gold ETFs continued in March, but at a much slower pace than previous months as North American and Asian inflows cushioned European losses.   WGC witnessed their tenth consecutive monthly outflow in March, losing US$823mn. But by comparison this is far less than February outflows (-US$2.9bn) and the average of the past nine months (-US$2.4bn). Collective holdings fell by 14t to 3,112t by the end of March, the lowest since February 2020 and 21% lower than the month over month (MoM). The month-end record lower that of 3,915t in October 2020.  However, helped by a jump in the gold price, total assets under management (AUM) rose to US$222bn, an 8% increase during the month, the highest in 21 months. All regions except Europe saw inflows in March.  Flows in North America flipped back to positive for the first tim...

Blockchain: Digital supply chain solution, bullion Integrity   aXedras Group AG (aXedras) announces it has concluded its Series B funding round, including a strategic investment from the World Gold Council (WGC) who will be represented on the Board of Directors by David Tait, CEO of WGC. The aXedras team is excited to have reached this latest milestone and will use this round of funding to move the business into a growth and global scaling phase.   aXedras uses blockchain- / distributed ledger technology to develop and implement a secure, confidential, digital supply chain solution for the precious metals industry, and to immutably document gold from the mine to the end-user.  Urs Röösli, Chief Executive Officer, aXedras commented, “We are excited to partner with WGC and look forward to expanding on the work we have already done. Our Bullion Integrity Ledger provides investors, consumers and all market participants with provenance, integrity and chain of custody crede...

A much heavier footfall for brides at the festive!   Update 1: Somasundaram PR, Regional CEO, India at World Gold Council (WGC) said, “Gold buying is an inseparable, nearly mandatory, part of Akshaya Tritiya celebrations for millions of Indians. After two years of covid induced lull, the festive sentiment among trade and consumers appears to be stronger this year, surpassing expectations. Sustained aggressive marketing and trade promotions have played a role in increasing in-store visits and leveraging the occasion.   Digital gold buying platforms also sound upbeat, with small buyers enthusiastically picking up the convenience of purchasing gold for as little as one rupee on their smartphone, without having to worry about purity and transparency. Even with gold prices at a high, initial market feedback point to a buoyant Akshaya Tritiya, due, in no small measure, to a heightened interest in gold among consumers following risks posed by inflation and global uncertainties.”...

The noticeable impact on Akshaya Tritiya demand   Somasundaram PR, Regional CEO, India at World Gold Council, shared his view on Akshaya Tritiya; “India's gold jewellery demand declined by 26% y-o-y in Q1 2022, to 94 tonnes, after reaching record highs in Q4 2021.   Fewer auspicious days, combined with a sharp spike in gold prices meant fewer weddings and a pause in retail demand, with households deferring gold purchases in the hope of a price correction.  As a major gold buying festival, we should see Akshaya Tritiya overcome these barriers and provide further impetus to demand in the second quarter. Underlying consumer sentiment is improving, which should also prove supportive.   The noticeable intensity of marketing efforts by players on the back of new digital and omni-channel retail strategies will positively impact demand during Akshaya Tritiya. Economic growth, combined with inflationary expectations, are poised to bolster gold purchase this festive season,...