Global gold demand in Q2 2014 declined 16% to 964 tonnes compared with Q2 2013 — a return to long-term trends after remarkable 2013, said the latest Gold Demand Trends report of the World Gold Council.
The largest segment of gold demand, jewelry, was down 30 percent, while bar and coin investment was less than half Q2 2013 levels.
Gold ETF outflows eased off to 40 tonnes
— a tenth of the redemptions in the same quarter a year ago.
Central banks’ net purchases in Q2 2014 totaled 118 tonnes, which is a 28% increase
over the same period last year. This marks the 14th consecutive quarter of central banks being the biggest net buyers of gold; ongoing global geopolitical crises and a trend toward diversification away from the US dollar are the main reasons, according the World Gold Council.
The report also observed that total investment demand (bars and coins combined with ETFs) was up 4% to 235 tonnes, compared to last year’s 226 tonnes.
Mine production went up 4% year-on-year for a second consecutive quarter, which increased gold supply by 10% to 1,078 tonnes. The World Gold Council expects supply to peak in 2014, reaching a plateau over the next 4-6 quarters.
“In the context of an exceptional year last year where we saw record consumer buying and investor sell-offs,” said Marcus Grubb, Managing Director of Investment Strategy at the World Gold Council. “This quarter’s demand continues to demonstrate a return to long-term trends, illustrating the uniquely balanced nature of the gold market.”
“Jewelry consumers continued to digest the exceptional purchases of 2013,” said Grubb, “and investors also rebalanced, pulling back from the extremes we saw last year. Overall the gold market is stabilizing following the extraordinary conditions we saw in 2013.”
For the complete report, visit the World Gold Council.
Sources:
Global gold demand continues to recalibrate in Q2 2014 after an exceptional 2013
Image by Rob Lavinsky