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Central banks bought more gold in 2018 than any year since 1967: WGC

Gold is traditionally seen as a safe investment in times of political or economic turbulence

Reuters  |  London 

Gold

A surge in gold purchases by central banks to the highest since 1967 helped push global demand for the up four per cent last year, the (WGC) said on Thursday.

The world consumed 4,345.1 tonnes of gold in 2018, up from 4,159.9 tonnes in 2017, the WGC said in its latest quarterly demand trends report.

Driving the increase were central banks which bought 651.5 tonnes - 74 per cent more than in 2017 and the second highest annual total on record - as countries including and joined Russia, and in adding to their reserves, the WGC said.

Jewellery demand was relatively unchanged at 2,200 tonnes, with rising consumption in China, the and offsetting a steep decline in the and a very slight fall in India.

in gold bars and coins grew 4 per cent to 1,090.2 tonnes - helped by a sharp 222-per cent rise in demand in to almost 62 tonnes, according to the WGC.

Interest from financial investors was lacklustre, with exchange-traded funds adding 68.9 tonnes to their holdings over the year, down 67 per cent from 2017.

That changed, however, in the final quarter of 2018, as rising economic uncertainty in and elsewhere rippled through

Demand for gold in and for jewellery fell as consumers scaled back spending, while investment demand rebounded and exchange-traded funds saw large inflows.

Gold is traditionally seen as a safe investment in times of political or economic turbulence.

"Economic uncertainty, slowdown, (and the) U.S.-trade conflict supported investment flows," said the WGC's intelligence, Alistair Hewitt.

"The flip side is that it hit some elements of the market," he said, adding that this dynamic is likely to run through 2019.

Hewitt said central would likely be elevated again this year and that demand in the two largest gold markets, China and India, would likely remain firm, with China consuming 900-1,000 tonnes and India 750-850 tonnes in 2019.

Global supply of gold grew by one per cent to 4,490.2 tonnes last year, the WGC said.

First Published: Thu, January 31 2019. 10:44 IST
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