By Paul Ploumis 28 Jul 2015 Last updated at 07:59:53 GMT

NEW DELHI (Scrap Monster): The global demand for gold plunged to its lowest level since 2009 during the second quarter of the year, noted GFMS in its quarterly report. The huge crash in Chinese equity market since mid-June has failed to support bullion prices. The Greek crisis too had failed to lend support to the yellow metal. The gold shipments to India dropped considerably during Q2 this year. The report further states that global gold demand and prices are likely to pick up momentum only in the final quarter of the year.

The physical gold demand in world’s top two consumers of gold-India and China continues to stay muted. According to GFMS report, Chinese demand for gold coins and bars plunged 26% year-on-year to 35 tonnes during Q2 this year. Gold jewellery purchases in the country dropped 23% to 102 tonnes. Meantime, India reported lowest gold import figure fell to the lowest in five quarters, falling 10% when compared with the year before. The gold consumption by China and India totaled 394 tonnes and 392 tonnes respectively during the quarter.

The global demand for gold bars and coins dropped nearly 12% during April-June quarter this year, in comparison with the corresponding quarter last year. When compared with 2013, the demand has declined by nearly 63%.Overall physical demand was down 14.2% during the second quarter at 858 tonnes. Also, gold jewellery consumption dropped 9% during the quarter. Gold jewellery production witnessed a decline of 6% year-on-year.

GFMS believes that the possible rate hike by the US Fed this year is already priced into the market and may in fact lead to increased gold holdings. The gold prices are likely to average at $1,135 per Oz during the third quarter. Also, the prices may recover to $1,175 per Oz during the last quarter of the yea