India pips China as world's biggest gold consumer in 2014

India is likely to remain the world’s biggest gold consumer this year after regaining the top spot from China in 2014, driven by robust jewellery demand, the World Gold Council (WGC) said on Thursday. Indian consumer demand for gold jewellery and investment totalled 842.7 tonnes last year, compared with 813.6 tonnes by China, according to WGC data. Demand dipped in both countries in 2014 from record levels a year earlier, but Indian demand slid only 14 percent, compared with a much steeper 38 percent fall in China. The two countries accounted for over half of global demand. Global gold demand also hit a five-year low last year as buying of jewellery, coins and bars failed to keep pace with 2013’s elevated levels, the WGC said on Thursday. [caption id=“attachment_1958991” align=“alignleft” width=“380”]  Reuters[/caption] The industry group forecast gold demand in both India and China to rise to 900-1,000 tonnes in 2015, but said India was likely to retain its edge. “We are maintaining the same level of demand for both the countries but Indian demand could rise marginally (higher) than China in 2015 as sentiment is ahead in India,” said Somasundaram PR, managing director of WGC’s India operations. “Jewellery demand is the major driving factor in India and would continue to drive the market in 2015 as well,” he said. India’s gold jewellery demand rose 8 percent to an all-time high of 662 tonnes in 2014 on strong purchases for weddings and festivals. The robust demand comes despite tighter gold import rules, some of which were removed only in the latter part of 2014. In contrast, Chinese jewellery demand slumped 33 percent from 2013, when a sharp slide in gold prices triggered massive purchases. Chinese appetite for gold has dropped after the 2013 buying frenzy due to a weak price outlook, with the WGC saying last year that this lower demand was the “new normal.” China’s jewellery and investment demand has also taken a hit from the country’s anti-corruption drive, which has curbed some gift-giving practices during festivals. The WGC said China was the single biggest contributor to a decline in global investment demand for gold bars and coins due to the corruption crackdown and weak price outlook. Investment demand in China halved in 2014 from a year earlier. “We can’t expect double-digit growth (in China) every year but we are looking at sustainable growth which is a reflection of people’s consumption power and appetite for investment,” said Albert Cheng, managing director of WGC’s far east region. Reuters