Total gold demand has increased 5% y-o-y to 1,313 tonnes, a record third quarter, with total demand exceeding US$100 billion ($132 billion) for the first time on record, The World Gold Council noted in its flagship Gold Demands Trend (GDT) report in 3Q2024.
According to the report, the London Bullion Market Association (LBMA) (PM) gold price continued to reach successive record highs in 3Q2024. The average price for this quarter grew 28% y-o-y at US$2,474 per ounce.
Gold ETFs contributed 95 tonnes, representing the first positive quarter since 1Q2022. Bar and coin demand fell by 9%, but total demand year-to-date remains steady at 859 tonnes compared to the 10-year average of 774 tonnes.
Gold jewellery consumption fell 12% on a y-o-y volume basis to 459 tonnes, but increased by 13% in value terms to US$36 billion, suggesting that consumers are comfortable spending more on lower quantities of gold products.
Central bank buying experienced a slowdown in 3Q2024 although demand remained robust at 186 tonnes. Year-to-date central bank demand reached 694 tonnes.
Total demand for gold in technology grew 7% y-o-y, supported by growth in the electronics sector given the artificial intelligence (AI) boom.
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Global investment demand more than doubled y-o-y to 364 tonnes, supported by a shift in demand for gold ETFs mainly from Western investors, although there is renewed interest across all regions.
With regards to gold supply, mine production grew 6% y-o-y to reach a quarterly record and year-to-date output has outperformed the prior high in 2018.
Recycled gold volumes grew 11% y-o-y but widespread distress selling is not yet in evidence.
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Investment flows supported gold’s performance in 3Q2024. Key drivers of this were falling interest rates, geopolitical uncertainty, portfolio diversification and momentum buying.
Gold continues to perform well, attracting investors in Singapore, with total bar and coin demand in Singapore growing by 12% y-o-y.
Global geopolitical tensions, local politics, economic concerns and bullish price expectations supported Asean investor’s appetite for 3Q2024, with Thailand, Indonesia and Malaysia experiencing double digit y-o-y growth.
The report notes that interest rate cut expectations, especially in the US and Europe, alongside ongoing geopolitical tensions, are likely to support investor interest in gold to provide a hedge against broader portfolio risks.
“In the third quarter of 2024, global gold demand continued its strong momentum, marking another quarter of resilience amid challenging market conditions,” says Shaokai Fan, head of Asia-Pacific (ex-China) and global head of central banks at the World Gold Council.
“Central banks worldwide maintained healthy demand for gold, solidifying its reputation as a vital asset for risk management and portfolio diversification in times of economic and geopolitical uncertainties. Singapore also mirrored this trend, with institutions actively leveraging gold as a strategic asset to strengthen their portfolios,” he adds.
