Gold demand up 1% in 2024, to remain supported by economic uncertainty: WGC

Global gold demand including over-the-counter (OTC) trading rose by 1 per cent to a record high of 4,974.5 metric tonnes in 2024 as investment increased, the World Gold Council (WGC) said on Wednesday, adding that central banks sped up buying in the fourth quarter. 

Spot gold prices rose by 27 per cent last year, the most since 2010, as investors chose the metal to hedge against global risks and as the US Federal Reserve slashed interest rates. Prices hit another all-time high on Tuesday, driven by safe-haven demand after China retaliated with tariffs on the United States in response to President Donald Trump's trade levies. 

Central banks, a major source of gold demand, bought more than 1,000 tonnes of the metal for the third year in a row in 2024. The National Bank of Poland was the largest such buyer, adding 90 tonnes to its reserves, the WGC, an industry body whose members are global gold miners, said in a quarterly report. 

In the final quarter of 2024, when Trump won the US election, buying by central banks accelerated by 54 per cent year on year to 333 tonnes, the WGC calculated, based on reported purchases and an estimate of unreported buying. 

Last year's investment demand for gold rose 25 per cent to a four-year high of 1,180 tonnes, mainly because outflows from physically-backed gold exchange-traded funds (ETFs) dried up for the first time in four years. 

 

Indicating a major shift in appetite for different products, investment demand for bars rose 10 per cent, while coin buying fell 31 per cent. 

"In 2025, we expect central banks to remain in the driving seat and gold ETF investors to join the fray, especially if we see lower, albeit volatile interest rates," WGC senior markets analyst Louise Street, said. 

"Geopolitical and macroeconomic uncertainty should be prevalent themes this year, supporting demand for gold as a store of wealth and hedge against risk." Total gold demand, excluding opaque OTC trading, rose 1 per cent to 4,553.7 tonnes last year, the highest since 2022, the WGC said. It estimates that OTC demand fell 7 per cent due to a slump in the final quarter of the year as profit-taking offset persistent demand from high-net-worth investors. 

Gold jewellery consumption, the biggest category of physical demand, fell 11 per cent in 2024, while mine production was steady and recycling rose 15 per cent. 

The WGC expects jewellery demand to remain under pressure and recycling to rise further this year due to high prices. 

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