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Mumbai, Aug. 19 Gold demand in the second quarter of 2009 was down 38 per cent to 109 tonnes on the back of high prices and weak economic conditions, according to the Gold Demand Trends published by the World Gold Council (WGC).

Demand from the jewellery sector was down 31 per cent to 88 tonnes. The demand for gold bars and coins more than halved to 21 tonnes against 48.1 tonnes in the second quarter of 2008.

However, gold demand in the June quarter was much higher compared with the 17.7 tonnes in the first quarter of 2009.

Mr Aram Shishmanian, Chief Executive Officer, World Gold Council, said the global economic downturn has certainly had a major impact on the purchasing power of gold consumers, as have the high local prices and dollar volatility.

“However, we continue to see pockets of solid demand in many non-Western markets on dips in the gold price. We expect consumers, particularly in India, to look for opportunities to buy back the jewellery that has been recycled over recent quarters,” he added.

On an average, gold prices in India ruled at Rs 14,860/10 gm in the June quarter, down about seven per cent from the historic peak of Rs 16,040/10 gm recorded on February 20, said an analyst.

More Stories on : Gold & Silver | Outlook | Economy

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