Demand for gold in India rebounded in July, with imports jumping by a quarter from a year earlier, as lockdowns to combat the coronavirus in the second-largest consumer of the metal were slowly eased.

Overseas purchases rose to 25.5 tonnes in July from 20.4 tonnes a year earlier and were almost double the amount shipped in the previous month, according to a person familiar with the data, who asked not to be identified as the information isn’t public.

Finance Ministry spokesman Rajesh Malhotra didn’t immediately respond to a call to his mobile phone.

Shipments in July showed the first year-on-year increase in 2020. Still, that may not be enough to compensate for the 79 per cent fall in imports in the first half of 2020. Demand is forecast to slide to a record low this year, hammered by all-time high prices and as the country heads toward its first annual economic contraction in more than four decades after virus-related restrictions shuttered businesses and left millions jobless.

The rapid spread of the virus in the country, which has the world’s third-highest tally, is also damping demand as consumers are worried about stepping out according to N Anantha Padmanabhan, chairman of the All India Gem and Jewellery Domestic Council. “There’s a long way to go before demand comes back,” he said. “Maybe from October, consumers will come to buy for festivals. How long can they postpone purchases for weddings and other occasions?” he quips.

Source: Bloomberg