In the international market too, demand for gold as investment declined sharply. Investment demand during the first nine months of 2000 declined by 27 per cent from a year ago. A sharp fall in sales of new coins in the US accounted for most of the decline. That brought total demand for the first nine months to 2,392 tonne, three per cent below the level for the same period last year.

However, WGC feels the jewellery demand in the first nine months of 2000 is `running a little above the record levels of last year'. Jewellery demand, according to WGC, for the nine months was 2,114 tonne, 1 per cent above the level of a year ago. And this strong performance is prompting gold bugs to remain bullish about the metal's prospects for the year, reports Reuters."Overall, we will have a good year on balance. Most retailers are actually looking for good fourth-quarter figures," Reuters quoted George Milling-Stanley, manager of gold market analysis at the WGC. "I believe we'll see very, very good jewellery demand in the remainder of the year."For the three months ended September 30, demand for jewellery was 717.5 tonne, down 5 percent from a year earlier.

Reduced number of auspicious dates (in the past nine months) for marriages in India was said to be one of the main reasons for lower offtake this quarter, said WGC's regional director Mr Derrick Machado.

Two other factors impacted lower gold demand in India, Mr Machado said. Higher oil prices and a five per cent depreciation of the Indian rupee led to the year-on-year increase in the international gold prices.

According to Mr Machado: "The year has been characterised by an overall economic slowdown and scattered rainfall distribution which led to uneven gold demand in certain pockets of the country. Keeping these adverse conditions in mind the gold demand this quarter has been promising". On the other hand, WGC's chief executive officer Ms Haruko Fukuda said: "Jewellery demand remains robust with the year to date demand above for the same stage of last year, when jewellery went on to break all records. There were strong recoveries in jewelery consumption during the third quarter in several countries where demand had been depressed. These markets include Thailand, where consumption rose 61 per cent, with a gain of 40 per cent and Turkey where demand increased 33 per cent.

The strength of overall gold demand is encouraging in the absence of the exceptionally high investment demand that was generated in 1999 by the Y2K concerns. Nevertheless, overall demand is not keeping pace with economic growth. "I consequently applaud the gold producers' acknowledgement of the crucial need for increased marketing, about which there is growing concerns".

Commenting on the global gold demand WGC's Machado said Comparing the global results this year, with an exceptionally strong year in 1999,the demand for gold as an investment was lower. Jewellery consumption rebounded in the latest third quarter, especially in countries were demand had been depressed, the council said. This included Thailand, where consumption jumped 61 percent, Japan with a rise of 40 percent, and Turkey, which saw a jump of 33 percent, helped by a strong economy and a buoyant tourist industry.

In the Americas, which includes the United States, Central and South America, gold demand fell 9 percent to 128.3 tonne.