Gold jewelry production grew 23 percent in the first half of 2007 as price volatility dropped during the period, precious metals consultancy GFMS reported in the first update of its Gold Survey 2007.
“The consultancy feels a key driver of jewelry’s increase was greater price stability, particularly in the second quarter when price volatility fell to 12 percent from 31 percent one year prior,” GFMS explained.
The survey noted that jewelry demand in India led the surge, rising by nearly 80 percent in the first six months. “Not all was merely a price response as off-take was further aided by robust economic growth,” the consultancy said of the rise in demand in India.
Elsewhere, strong growth in gold jewelry manufacture was realized in the Middle East having increased 17 percent, while East Asia, and particularly China, were also mentioned as high growth areas.
Conversely, western countries experienced declines in jewelry fabrication as Europe battled to contend with overseas competition and a stronger euro which hurt output.
The United States posted a double-digit fall in first half jewelry consumption, “which was important for many countries as it fed through to a 13 percent slide in jewelry imports,” GFMS reported.
Looking ahead, GFMS predicted that global gold jewelry production would continue to grow through the second half of 2007 and could rise by 6 percent year-on-year in the period.
Philip Klapwijk, GFMS’ executive chairman, cautioned however that “the timing and extent of any rally could alter that forecast for jewelry.”
Source: diamonds
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