Indian gold sales are down 50% this year according to early reports. As regular readers know, your friendly Gold Enthusiast watches the Indian retail gold market closely, especially during its marriage season. Still, a drop this precipitous is worse gold news than we’d bargained for.
This year we knew things would be different, given India’s tax restructuring and steps toward reducing money laundering. High-end sales appear to be hit the most, which makes sense as the Indian government took away large-denomination cash bills. And there are signs the market is trying to shift toward cash sales, avoiding credit card purchases.
Normally this would be seen as people trying to avoid the newly-restructured VAT taxes and possible government scrutiny of large purchases, but it may simply be a pause while people learn the new lay of the land.