Demand for yellow metal gained strength in ’95

The first nine months of this year have been good ones for the worldwide gold industry.

The latest issue of Gold Demand Trends, published by the World Gold Council, shows that the amount of gold consumed during the period was 19% higher than in the same period last year.

The report also shows that, in many countries, the level of gold demand for jewelry, bars, coins and dental alloys is expected to break annual records by year-end.

Among the 10 most important gold-consuming countries, Japan has put in the strongest performance for the year to date, with consumption rising 35% to 232 tons. India also posted a strong increase, showing a 26% rise to 365 tons, and further gains are evident in Indonesia, South Korea and Saudi Arabia.

The publication notes that gold demand in the U.S. grew by 4% (driven by jewelry), and resulted in a record offtake level for the third quarter. This increase brought the 1995 year-to-date demand total to 226 tons, or 6% ahead of the same period a year ago.

On a less positive note, demand eased slightly in several developing markets in the Far East, namely Taiwan, China, Hong Kong, Malaysia and Singapore. However, the Gold Council says this was not altogether unexpected, “after two years of strong demand growth in the region.”

Gold-price volatility remained low during the third quarter, with the range continuing to narrow to US$11 (from US$20 in the first quarter and US$14 in the second), and yet further in the fourth quarter, to around US$5.

A spokesman for the council says the strength of demand for physical gold products, both in the developing and developed countries, “seems to ensure that, for many countries, 1995 will be a record year for gold consumption.”