JEDDAH: The global jewelry demand totaled 408.7 tons during the second quarter, declining 5 percent from year-earlier levels, according to the latest Gold Investment Digest from the World Gold Council (WGC). This was the smallest decline in the rolling four-quarter performance since the first quarter of 2008, indicating a deceleration in the pace of decline in global jewelry demand. However, expressed in US dollar value terms, jewelry demand totaled $15.7 billion, 23 percent higher than the $12.8 billion level in Q2 2009. Jewelry off-take was lower across most markets, with just a handful of countries bucking the trend to post an increase over Q2 2009. However, a consideration of global jewelry demand in value terms paints a different picture, with a few markets experiencing a decline in the US dollar value of gold jewelry off-take. At the country level, the Southeast Asian markets of Thailand, Indonesia and South Korea sustained the worst falls in Q2 gold jewelry demand as consumers in these markets proved to be particularly susceptible to the high price level. Gold jewelry demand in India, the largest jewelry market, was little changed from year earlier levels, down just 2 percent at 123 tons. The Middle East region had a mixed quarter, with Saudi Arabia (+5 percent YoY) witnessing a rise in gold jewelry demand as the improved domestic economic scenario boosted consumption, while the other Gulf group of countries under performed markedly (-25 percent YoY). Hong Kong recorded the largest rise in tonnage jewelry demand (+34 percent YoY) as it recovered from the very weak levels of Q2 2009, when demand was badly affected by swine flu. Elsewhere in the Greater China region, mainland China saw demand for gold jewelry increase by 5 percent YoY to 75.4 tons. In Japan, gold jewelry demand grew by 15 percent compared with Q2 2009, buoyed by the improving economic background. Jewelry demand across Europe and North America continued to suffer from the combination of record gold prices at a time of continued economic uncertainty. The exception to this was Russia, where gold demand recovered to 16.3 tons from 13.9 tons a year earlier, an increase of 17 percent.
