The global appetite for gold is not diminishing with $3.7 billion of the precious metal paid by industry and consumers in the third quarter of 2013.
Demand is strong across most markets and nations, according to the World Gold Council.
Around 865 tonnes of gold was mined or sifted from stocks to meet the demand in the quarter.
Who is buying gold
The report highlighted:
- Demand for gold for jewellery rose by 5% to 486 tonnes with investors seeking high carat items for investment as prices lowered.
- Small gold bar and coin demand increased 6% and has hit 2, 900 tonnes for the year. These are coveted by consumers and investors in the Middle East and Asia
- Gold-backed exchange traded funds (ETFs) fell back slightly to 119 tonnes
- Rising sales for tablets and mobile phones has increased the demand for gold in technology products
- Central banks are buying in more gold but at a slower rate than in 2012. Global reserves have increased by 300 tonnes.
- Year-on-year the supply of gold has dropped 3% mainly due to less recycling as mining rose by 4%
“The market for gold worldwide in the third quarter has followed the trend for the rest of the year,” said Marcus Grubb, of the World Gold Council. “We have noted demand is moving from west to east with a strong desire to buy from consumers, technology businesses and central banks.
Liquid market
“Different products seem popular at different points of the economic cycle. Jewellery, bars and coins are leading the way now in what is a liquid market.”
The council also explained that new import restrictions in India introduced during the quarter have seen demand in the country drop from 310 tonnes in the second three months of the year to 148 tonnes in the third quarter.
In Q3, the average price of gold was 20% down year-on-year to $1,326 an ounce, which meant the value of gold in the quarter slipped $37 billion or 37%.
Although demand dropped in India, China saw an 18% increase on the same period in 2012. Other improving markets were Hong Kong (up 28%), Thailand (up 57%), Indonesia (up 19%) and Vietnam (up 14%).
Consumption in the US increased 14% and the Middle East 9%.
“Government restrictions in India are reflected in the demand for the quarter,” said Grubb. “It doesn’t mean demand is dropping there as we have seen supplies increase in other countries and we suspect gold may be finding a way to India via a black market.”
World Gold Demand – By Volume (tonnes) and Value ($US)
Source: World Gold Council
