Record high prices and coroanvirus crisis has severely hurt gold demand in India. Indian consumption could plunge to a 26-year low in 2020, the World Gold Council said. India’s gold imports plunged 96% year-on-year in the June quarter to 13 tonnes.

On MCX, gold futures hit a record high of ₹53,700 per 10 gram and is up over 35% this year.

International spot prices hit a new record of $1,980.57 on Tuesday on surging safe-haven investments due to the coronavirus outbreak.

A gold dealer, quoted by Reuters, said that physical gold supplies were tight due to travel restrictions while some improvement was seen in investment demand.

World Gold Council said that record inflows were witnessed into gold-backed ETFs this year.

In India, gold exchange traded funds or gold ETFs saw hefty net inflows of over ₹3,500 crore in the first six months of this year as investors continued to hedge their exposure to riskier assets amid the COVID-19 crisis.

In comparison, investors had pulled out ₹160 crore from this asset class in January-June 2019, according to the latest data available with the Association of Mutual Funds in India (Amfi).

Gold-backed ETFs are passive investment instruments that are based on price movements and investments in physical gold.