Demonetisation is expected to shave off 300 tonnes of India’s gold demand, which is unlikely to come back in a hurry.

Average monthly gold imports, which has been around 65-70 tonnes for the past few years, halved between February and September this year. In October and November, there was a recovery on account of festive buying and marriage season. However, demonetisation is expected to result in a drop in demand.

Sudheesh Nambiath, lead analyst, precious metals demand, South Asia & UAE, GFMS, Thomson Reuters, said, “Our estimate is that 300 tonnes of gold demand, which was predominantly cash-based buying will be shaved off in 2017.”