What has been the impact of the rising gold prices on jewellery demand in India?

The two of the largest markets for jewellery in the world; India and China have seen a virtual slump in demand for gold jewellery. In fact, India’s demand for gold jewellery fell by 41% in the March 2020 quarter to 73.9 tonnes. This marks an 11-year low due to the weak demand triggered by the Coronavirus pandemic. The India fall is sharper than the 39% drop globally. Jewellery demand in China fell by 65% during Mar-20 quarter to a 13-year low of 64 tonnes. The gold prices are getting closer to $1750/oz, fairly close to their all time peak levels of $1879/oz touched in September 2011. The virus spread also caused disruption to gold supply with mine production dipping 3% YOY to a 5-year low of 795.8 tonnes. Clearly, the impact on gold jewellery demand has been quite sharp in India which is a fairly price sensitive market.