The following is an edited summary released by the World Gold Council based on their Gold Demand Trends report for the first quarter. For more information, please visit www.gold.org.
The first three months of 2015 saw stable gold demand. Total demand for first-quarter 2015 was 1,079 tonnes, down just 1% on the same period last year.
Conditions differed from market to market, but at an aggregate level, these differences balanced each other out. Once again consumers in Eastern countries dominated the market, with China and India alone accounting for 54% of total global consumer demand in the quarter.
Global demand for jewellery, still the most significant component of overall demand, totalled 601 tonnes in first-quarter 2015, 3% lower than the 620 tonnes recorded in the same quarter last year. There were pockets of strength across a number of Southeast Asian countries — including Malaysia, Indonesia, South Korea, Thailand and Vietnam. In addition, jewellery demand in India was up 22% to 151 tonnes, while the U.S. saw further steady growth, up 4%. This was counterbalanced by declines in Turkey, Russia and the Middle East, and in China, jewellery demand dropped 10% to 213 tonnes, as a rising stock market diverted money into equities — but it was still up 27% against the five-year average.
Investment demand, the other key driver of the world’s gold market, rose 4% to 279 tonnes in first-quarter 2015, up from 268 tonnes in first-quarter 2014. There were net inflows of 26 tonnes into gold-backed exchange-traded funds — turning positive for the first time since fourth-quarter 2012, as western investor sentiment returned to gold. Investment in bars and coins came under pressure in the face of buoyant stock markets — notably in India and China — and currency fluctuations in Turkey and Japan, but this was offset by strong retail investor demand in the eurozone up 16% to 61 tonnes, most notably in Germany and Switzerland.
Central banks were strong buyers, purchasing 119 tonnes in the quarter — the same volume as in first-quarter 2014. This was the seventeenth consecutive quarter that central banks have been net gold buyers, as they seek diversification away from the U.S. dollar.
Total supply was virtually unchanged at 1,089 tonnes, as a 2% rise in first-quarter 2015 mine production to 729 tonnes was balanced by a 3% fall in recycling to 355 tonnes, compared with the same quarter last year.
In value terms, gold demand in first-quarter 2015 was US$42 billion, down 7%, compared to first-quarter 2014. The average gold price of US$1,218.5 per oz. was down 6% on the average first-quarter 2014 price.