Value of gold demand rockets with price
ETF and OTC investment flows buoy total demand
Total gold demand (inclusive of OTC investment) gained 5% y/y to 1,313t – a record for a third quarter. This strength was reflected in the gold price, which reached a series of new record highs during the quarter. The value of demand jumped 35% y/y to exceed US$100bn for the first time ever.
Global gold ETF inflows (95t) were a major driver of growth; Q3 was the first positive quarter since Q1’22, with a y/y swing from hefty (-139t) Q3’23 outflows.
Bar and coin investment (269t) was down 9% y/y, from a relatively strong Q3’23. Much of the decline was specific to two or three key markets, counterbalanced by a very strong quarter in India.
Gold jewellery consumption (459t) sank 12% y/y despite strong growth in India. Although consumers bought reduced quantities, their spend on gold jewellery increased: the value of demand jumped 13% y/y to more than US$36bn.
The pace of central bank buying (186t) slowed in Q3, but y-t-d buying is in line with 2022 and remains widespread.
AI continued to support the use of gold in technology (83t); it grew 7% y/y albeit from a fairly low base and the outlook remains cautious.