In India, where gold is a national obsession, jewelry buyers are about to be stripped of their title of largest consumer of gold
Turns out investors there have caught on to the recent surge in gold and thus, have started buying up lots of it. Gold (GLD) bars, coins – anything they can get their hands on. Within two to three years, these gold investors are poised to usurp jewelry buyers as the kings of gold.
Economic Times: “The signs of heavy increase in investment demand are visible and may outperform jewellery demand in 2-3 years” said Anjani Sinha, president of Indian Bullion Market Association (IBMA), which represents about 10,000 jewellers across the country.
“We may see 20-30 per cent rise in investment demand driven by the new class of investors. Even during this festive season, demand for coins was more compared to jewellery, strengthening the trend.”
To boot, it appears gold is already being scooped up at an growing rate:
IBMA said it has sold 7,000 coins of 8 grams each since August and hopes to target 100,000 coins within one year.
Former central bank governor C. Rangarajan, who heads the government panel that advises the prime minister, said growth in the fiscal year that ends in March 2011, would accelerate to 7 to 8 per cent after growing by about 6.5 per cent in 2009/10