The gold price has increased by more than 28% y-t-d in US dollars, trading 22% higher on average this year than during 2023; its performance across currencies was equally strong. Gold reached 40 new record highs y-t-d and total gold demand in the third quarter (3Q) surpassed US$100 billion for the first time.
Total gold demand (inclusive of OTC investment) gained 5% y/y to 1,313t – a record for a third quarter. This strength was reflected in the gold price, which reached a series of new record highs during the quarter. The value of demand jumped 35% y/y to exceed US$100bn for the first time ever in the 3Q.
Gold jewellery consumption (459t) sank 12% y/y despite strong growth in India. Although consumers bought reduced quantities, their spending on gold jewellery increased: the value of demand jumped 13% y/y to more than US$36bn.
Global gold ETF inflows (95t) were a major driver of growth; Q3 was the first positive quarter since Q1’22, with a y/y swing from hefty (-139t) Q3’23 outflows.
Investment demand, especially through over-the-counter transactions, was supported by an undercurrent of geopolitical risk and volatility in many regional financial markets. Central banks continued to add gold to reserves y-t-d, with buying picking up speed in early October. And, for most of the third quarter, Western investors flocked back to gold as central banks started cutting interest rates.
Against this backdrop, gold remains one of the best performing assets of the year.
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