Global gold demand reached all-time peaks for any third quarter during the last three-month period, the World Gold Council (WGC) said on Wednesday.
At 1,313 tonnes, total consumption was up 5% year on year.
The council said that “this strength was reflected in the gold price, which reached a series of new record highs during the quarter.”
This price jump meant the value of gold demand leapt 35% from the same 2023 period to exceed $100 billion for the first time in history.
Bullion prices have struck repeated highs this year on a multitude of factors, including expectations of steadily-falling interest rates, conflict in the Middle East, and uncertainty around the US Presidential election.
Gold values averaged $2,474 per ounce during quarter three, the WGC said.
The precious metal continues to appreciate and came within a whisker of $2,790 per ounce earlier on Wednesday.
ETF Renaissance Lifts Demand
Soaring gold demand has been driven by rejuvenated investor interest in exchange-traded funds (ETFs), according to the WGC.
Global funds experienced their first positive quarter since the beginning of 2022 during the July and September period, breaking nine quarterly drops on the bounce.
Total ETF inflows were 95 tonnes between July and September, swinging from outflows of 139 tonnes in the same 2023 quarter.
The council said that “all regions saw positive inflows during the quarter, which ended with collective holdings of 3,200 tonnes.” As a result, total outflows for the nine months to September were reduced to just 25 tonnes.
The WGC noted that “Western-listed funds witnessed a turnaround during the quarter,” adding that US funds are now positive in the year to date.
Recovering ETF inflows meant total gold investment demand soared 132% in quarter three, to 364 tonnes.
Strong fund activity more than offset a 9% decline in gold bar and coin demand, to 269 tonnes.
The WGC said that “China, Turkey and Europe were the main contributors to the year-on-year slowdown, outweighing growth in India and several of the smaller markets in Asia.”
Physical gold demand in India reached its highest third-quarter total since 2012, the organisation noted.
Central Bank Interest Cools, Jewellery Demand Drops
The rate of central bank buying cooled during the quarter, however, as higher gold prices dented interest.
Total purchases of 186 tonnes were down sharply from 364 tonnes in the third quarter of 2023. This was also the third consecutive quarter of declines.
The WGC said that “the slowing of quarter three demand can likely be attributed to the sharp rise in prices prompting a pause in buying by some central banks combined with limited tactical selling by others.”
Jewellery demand dipped 12% year on year to 459 tonnes in quarter three. Demand in Mainland China slumped by a third to 103 tonnes, which more than offset a 10% increase in Indian purchases, to 172 tonnes.
Supply Rises
On the supply side, mine production totalled 990 tonnes, up 6% year on year. Meanwhile, recycled gold levels shot up 11% to 323 tonnes as people cashed in on the booming metal price.
Total supply was up 5% year on year, at 1,313 tonnes.