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Indians switch to bars and coins as festival jewellery sales plummet 25 – 30%

The Economic Times reports gold and diamond jewellery sales across India fell by 25-30% in grammage terms during Diwali due to rising gold prices and a noticeable shift to coins and bars, said a leading industry body which represents 300 000 jewellers.

India is world’s number one gold jewellery market and the sales figures can be seen as a setback for the industry. In August the World Gold Council said despite a higher gold price, Indian demand grew 38% during Q2 2011 compared to the same period of 2010 and will continue to expand for the rest of the year. India imported 918 tonnes of gold in 2010.

Read more about India’s growing impact on world commodity markets.

The WGC’s advertising campaign ‘10 Diwalis ago’ focuses on gold as a storer of value:

China has been slowly hauling in India in terms of demand for bullion and reported last week that Chinese consumers made the most of the dip in the price of bullion and mainland China’s gold purchases via Hong Kong hit almost two tonnes per day in September, a sixfold increase year-on-year and up 30% from August, according to figures released by the Hong Kong government. Read more about gold going viral in China. reported over the weekend according to a new report by MarketWatch, gold’s allure is shifting to a new generation. Many people in their 20s and 30s have little faith in equities and, unlike older investors, are more inclined to consider alternative investments. Others seek tangible, hard assets as a counterweight to stocks, bonds and cash in the aftermath of the 2008 US financial crisis. Read more about Generation X and Y turning into Generation Au.