The Gold price rally in Q1 was driven by a combination of strong central bank and OTC buying, according to a recent report by the World Gold Council (WGC).
Total demand during the period was estimated at 1,238.3 tonnes compared to 1,269.7t in the previous quarter.
Over-the-Counter, or OTC buying – which is not conducted via exchanges and so can only be estimated – rose by 136.4t compared to 126.9t in Q4.
Heavy buying by central banks was a contributing factor in the rally in Gold price, with 289.7t of Gold bought by this market compared to 219.6t in the previous quarter.
“Q1 saw no let-up in the pace of central bank gold buying: 290t (net) was added to official holdings,” said the report.
Further details from the WGC report are as follows:
- Gold mine production increased 4.0% YoY to 893t – a record first quarter for the WGC data series.
- Gold recycling climbed 12% YoY to 351t, the highest quarter since Q3 of 2020.
- Eastern investors exhibited different behavior to Western investors, whilst Western gold buying experienced healthy levels of profit-taking. “This contrasted with strong buying into the price surge in Eastern markets,” said the WGC report.
- Global Gold ETF holdings fell by 114t, with Europe and North America experiencing quarterly outflows.
- Demand from the jewelry sector remained healthy, given the price rally. Global jewelry consumption fell just 2.0%.
- Gold demand from the technology sector rose 10.0% YoY as the AI boom boosted buying from the tech sector
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