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Sharp fall in purchases pulls global gold demand down by 8% in Q2

A sharp fall in purchases by investors pulled global gold demand down 8% in the second quarter compared to the same period in 2021, the World Gold Council said on Thursday.

Gold

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Reuters LONDON
LONDON (Reuters) - A sharp fall in purchases by investors pulled global gold demand down 8% in the second quarter compared to the same period in 2021, the World Gold Council said on Thursday.
Gold is typically seen as a safe place to park money in times of turmoil and investment demand surged early in the year as Russia invaded Ukraine and inflation rose rapidly.
But central banks then began raising interest rates.
While this increased the threat of recessions, it also pushed up bond yields, making non-yielding gold less attractive, and boosted the dollar, making dollar-priced bullion more expensive for buyers with other currencies.
Exchange traded funds (ETFs) holding bullion for investors sold 38.8 tonnes of gold back into the market over April-June, the WGC said in its latest quarterly report.
That selling mirrored a decline in gold prices, which have slipped to around $1,720 an ounce from more than $2,000 in March.
"Safe haven demand will likely continue to support gold investment, but further monetary tightening and continued dollar strength may pose headwinds," said WGC analyst Louise Street.
She also said slowing economic growth and cost-of-living crises would likely reduce purchases of jewellery, bars and coins.
Global gold demand amounted to 948 tonnes in the second quarter, the WGC said. For the first half the year, demand was 2,189 tonnes, up 12% compared to January-June 2021 thanks to a strong first quarter, it said.
(Reporting by Peter Hobson; editing by David Evans)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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First Published: Jul 28 2022 | 7:26 AM IST

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