Indian consumers turning to Gold Investment

A prominent Indian gold industry figure predicted today (October 21st) that levels of Gold Investment in the country will surpass jewellery buying in the next two to three years.

Indian consumers are famed for their love of the yellow metal, but until recently their interest mainly centred on jewellery, especially during festive and wedding seasons.

However, Anjani Sinha, president of Indian Bullion Market Association - which represents about 10,000 gold dealers - explained that Investing in Gold is growing significantly in popularity.

"The signs of heavy increase in investment demand are visible and [it] may outperform jewellery demand in two to three years" he told Reuters.

"We may see [a] 20 to 30 percent 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."

Meanwhile, analysts at Commerzbank, which is the second-largest bank in Germany, have also expressed their belief that the future of gold appears to be bright.

In a new report quoted by the Wall Street Journal last week, they indicated that a move to $1,200 per ounce would not be out of the question.

"A weekly close above $1,057 is still needed in order to confirm that [resistance] has been cleared. Above here would introduce scope towards $1,191," they said.

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