Gold Demand Hits Q2 Record High, Driven by Central Bank Purchases, World Gold Council Reports

The World Gold Council’s Q2 2024 report highlights a year-on-year increase in gold demand, marking the highest second-quarter demand since 2000. This surge is fueled by central bank purchases and OTC investments, with central bank gold buying up by 6% and technology sector demand rising by 11%.

Q2 2024 Sees Record Gold Demand

The World Gold Council’s latest report, published on July 30, highlights Q2 2024 trends, showing the highest second-quarter gold demand since records began in 2000.

While noting that “Gold demand excluding OTC in Q2 was down 6% y/y to 929t as a sharp decline in jewelry consumption outweighed mild gains in all other sectors,” the report notes that “adding in OTC investment to total gold demand yields a 4% y/y increase to 1,258t – the highest Q2 in our data series back to 2000.”

The report adds:

Central bank net gold buying was 6% higher y/y at 184t, driven by the need for portfolio protection and diversification.

Jewelry demand fell 19% year-on-year to a four-year low of 391 tonnes, largely due to record-high gold prices, which averaged $2,338 per ounce in Q2 and peaked at $2,427 per ounce in May.

The World Gold Council further detailed that “Total gold supply grew by 4% y/y to 1,258t. Mine production of 929t was a record for a second quarter. Recycling supply was the highest for a second quarter since 2012, responding to the rising gold price.”

The report also notes a 7-tonne decline in global gold exchange-traded fund (ETF) holdings in Q2 and a 5% decrease in retail bar and coin investment to 261 tonnes, primarily due to weak demand from Western markets. The report further highlights:

Gold used in technology jumped 11% y/y, as the AI trend continued to drive demand in the sector.

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