31 October, 2023

Investment demand in Q3 was 157t – a significant improvement on the paltry Q3 2022 but weak in comparison with longer-term average levels.

  • Global gold ETFs sustained a sixth consecutive quarter of outflows in Q3; holdings fell by 139t (-US$8bn), although this was at least an improvement on the hefty 244t outflows of Q3’22
  • Total bar and coin investment in Q3 was down 14% y/y at 296t, weighed down by European weakness; but Q1-Q3 demand from this segment is in step with that of 2022, which was the strongest year for almost a decade
  • On a y-t-d basis total investment demand is 21% lower at 687t, almost exclusively driven by the prolonged period of ETF outflows, which have centred on funds listed in Western markets.
Tonnes Q3'22 Q3'23   y/y change
Investment 100.1 156.9 57%
Bar & coin 344.2 296.2 -14%
  India 45.0 54.5 20%
  China, P.R.:Mainland 70.1 81.6 16%
Gold-backed ETFs -243.7 -139.3 - -

Source: Metals Focus, World Gold Council

Investment demand for gold ETFs, bars and coins was anaemic in Q3. At 157t, investment was only half of its five-year quarterly average of 315t. Nevertheless, this translated to a 56% y/y increase from Q3’22, which was the weakest quarter for 18 years at just 100t. Over the first nine months of the year investment demand was down by 21%, with most of that weakness driven by ETFs. 

The ‘OTC and other’ portion of investment demand was 120t in Q3. The Q2 figure was revised down to 222t (previously 332t), due to a combination of additional information regarding central bank buying and a downward revision to Q2 supply figures (which are always considered ‘provisional’ at the time Gold Demand Trends is published due to the reporting schedule of gold producers). OTC demand in Q3 seemed to be supported by continued High Net Worth (HNW) demand in Turkey and modest stock build in other markets. And while this positive demand again ran counter to the trend in COMEX net long futures positioning, it was reflected in the continued strength in the gold price, which found a solid floor around US$1,900/oz for much of the quarter, despite ETF outflows and weaker bar and coin buying.


Q3 saw continued outflows from gold ETFs (-139t; -US$8bn), particularly in the US and Europe, as investors increasingly took the view that major central banks – notably the US Fed – will keep rates ‘higher for longer’. Y-t-d, holdings have declined by more than 5% (-189t), while total assets under management (AUM) are only 2% lower due to the mitigating effect of the higher gold price in 2023. This compares with a decline of just 20t over the same period of 2022.

North American-listed gold ETFs sustained the heaviest losses in Q3, with a decline of 96t (-US$5.8bn). The region’s funds have registered outflows for four consecutive months, with investors discouraged by the combination of higher Treasury yields, stronger projections for US economic growth and a stronger dollar. The heaviest outflows occurred in August (-44t) and September (-35t).

The Q3 decline brings y-t-d outflows from North American funds to 76t (US$4.3bn), with the largest and most liquid funds losing the most.

European ETFs have seen a similar pattern of outflows in recent months, resulting in a Q3 decline of 55t (-US$3bn). Losses were heaviest in September (-28t, -US$1.4bn) – a month in which the European Central Bank delivered its tenth consecutive rate hike and reiterated that rates will stay “at sufficiently restrictive levels for as long as necessary”.1  And despite a pause in the Bank of England’s rate tightening cycle, policymakers kept the possibility of further tightening on the table. Investor expectations for higher rates (and, therefore, a heavier opportunity cost for holding gold) likely drove the continued unwinding of gold ETF holdings across the region.

During the first nine months of 2023 outflows from European funds – mainly driven by the UK and Germany – totalled 124t (-US$7.2bn).


US and European-listed funds continued to dominate outflows in Q3*

US and European-listed funds continued to dominate outflows in Q3*

US and European-listed funds continued to dominate outflows in Q3*
* Data as of 30 September 2023. Source: Bloomberg, Company Filings, ICE Benchmark Administration, World Gold Council

Sources: Bloomberg, Company Filings, ICE Benchmark Administration, World Gold Council; Disclaimer

* Data as of 30 September 2023.

In contrast, Asian funds saw inflows for the second successive quarter, adding 13t (+US$860mn) in Q3. China (+10t) continued to drive the region’s inflows amid increasing promotional efforts from fund providers, the surging local gold price and continued weakness in local assets. India and Japan also saw decent inflows: 2.5t and 1.2t respectively.

Y-t-d, Asia funds capped inflows of US$907mn while their collective holdings increased by 14t (+12%); the bulk of these inflows were registered in Q3.

Gold ETFs listed in other regions registered 1.5t of outflows in Q3 (-US$70mn). Between January and September the region’s outflows amounted to US$140mn (-2.8t), mainly driven by Australia and South Africa.

Since the end of Q3 – and at the time of writing – outflows have continued along the much the same vein for the first half of October,with continued outflows from Western-listed funds contrasting with small consistent inflows into funds listed in Asia and other regions.

For a more detailed review of regional activity in global gold-backed ETFs see our latest monthly Gold ETF commentary.

Bar and coin

After a strong H1, bar and coin investment in Q3 was 14% lower y/y at 296t. Demand was, however, up q/q and comfortably above the five-year quarterly average of 267t. Y-t-d, demand in this sector almost matches that of last year – 876t vs 886t in 2022 – as H1 strength outweighed Q3 weakness. The y/y decline in Q3 was due to certain pockets of lower demand, notably in Europe (Germany in particular), the US, Turkey, Australia and Iran.


Bar and coin demand so far in 2023 is on par with the last two years of healthy investment*

Bar and coin demand so far in 2023 is on par with the last two years of healthy investment*

Bar and coin demand so far in 2023 is on par with the last two years of healthy investment*
* Data as of 30 September 2023. Source: Metals Focus, World Gold Council

Sources: Metals Focus, World Gold Council; Disclaimer

* Data as of 30 September 2023.


Quarterly demand for gold bars and coins in China, at 82t, was the strongest since Q1’21. Economic and geopolitical uncertainty, as well as disappointing performance from other assets, drove demand up 16% y/y and 66% q/q.

A surge in the local Shanghai gold price premium to a record high US$121/oz during the quarter kept gold in the headlines and further contributed towards the positive sentiment, raising gold’s appeal as a wealth-preserving store of value.2 Ongoing depreciation in the local currency kept the local gold price supported and a lack of attractive alternative investments worked to gold’s advantage, given the relatively disappointing performance in the local stock market and the real estate sector. Continued buying by the People’s Bank of China also likely cemented positive sentiment towards gold among the general populace.

During the first three quarters of 2023 Chinese households bought 197t of bars and coins, 25% ahead of the same period in 2022. The same supportive factors have been in play throughout the year so far: namely, economic and geopolitical uncertainties, the attractive returns in the RMB-denominated gold price relative to other local assets, and the domestic central bank’s gold purchasing spree.

Looking ahead, we expect local gold investment demand to remain robust in Q4. The fragility of the domestic economic recovery, along with intensifying global geopolitical risk, could continue to support Chinese investors’ safe-haven demand for gold. And its appeal to bar and coin investors could be boosted further if the PBoC continues to report gold purchases. A caveat, however, is that the slightly later timing of the Lunar New Year in 2024 will likely push the usual Q4 sales boost ahead of the CNY holiday into Q1’24.3


Bar and coin investment in India reached 55t – the highest for a third quarter since 2015. Demand jumped 20% y/y and was 38% higher than its five-year quarterly average of 40t. Y-t-d, investment has inched ahead of the same period last year, reaching 118t (vs 117t in 2022).

Investors reacted to the downward correction in the gold price from its Q2 record high, adding to their holdings in the expectation of a price recovery in Q4 as the wedding and festive season gets underway. 

The economic environment remains supportive, with most macro indicators pointing towards continued momentum in economic growth. And a good 2023 monsoon bodes well for farm incomes in Q4. That said, the recent jump in oil prices poses a challenge, given India’s heavy reliance on oil imports. And the recent gold price volatility, spurred by heightened global geopolitical concerns, may also discourage some investors. 

Middle East and Turkey

Y-t-d bar and coin demand in Turkey already exceeds the previous full-year record set in 2020. Demand remained very elevated in Q3 at 30t, 40% above its five-year average. Nevertheless, the y/y comparison showed a 16% contraction as Q3’22 was exceptionally strong. 

Difficult local conditions continued to drive gold demand in Turkey; in particular the spiralling inflation rate and a perennially weak currency. Gold has also benefited from its strong performance in local currency terms, which has raised its appeal relative to other local investment assets.4

A continuation of HNW interest in gold was also observed during Q3. These demand flows fall within our ‘OTC & other’ segment of demand as they are directed towards larger format bars rather than the smaller (1kg and under) bars that typically constitute bar demand at the individual investor level. 

Local gold price premiums spiked during the quarter after gold import quotas were re-introduced to combat high trade and current account deficits. Given the continued strength in gold demand, these are contributing to tight local conditions and suggest that high premiums are likely to persist at least until the end of the year.

Iran and Egypt drove a decline in regional Q3 bar and coin demand in the Middle East. Other markets across the region saw growth as investors bought into the price correction.  

The 29% y/y decline in Iran’s Q3 bar and coin investment was partly due to Q3’22’s strength and partly due to local gold prices remaining broadly directionless during the quarter. Nevertheless, demand continues to draw support from persistently high inflation, and at 10t, was marginally above its five-year average.

Egyptian bar and coin demand saw a 4% y/y drop in Q3 to 6t. That said, investment demand remains at levels that are multiples of those typical just two years ago, and y-t-d demand is 87% above the same period of 2022. But the introduction of a sales tax on the labour charge for small gold bars (up to 100g) brought down local premiums and could also crimp demand at the margin in Q4. 


Year-to-date weakness in European bar and coin demand has offset growth in Turkey and China

Year-to-date weakness in European bar and coin demand has offset growth in Turkey and China

Year-to-date weakness in European bar and coin demand has offset growth in Turkey and China
* Data as of 30 September 2023. Source: Metals Focus, World Gold Council

Sources: Metals Focus, World Gold Council; Disclaimer

* Data as of 30 September 2023.

The West

The pace of bar and coin investment in the US slowed in Q3, with considerable declines both q/q and y/y. Demand of just over 21t was nonetheless healthy in a longer-term context and y-t-d investment is 2% ahead of the same period last year (87t vs 85t). 

The lacklustre atmosphere that had settled in the market towards the end of Q2 carried on throughout Q3; net demand remained subdued in the absence of any fresh positive news to stimulate investment. The relatively stable and high price environment through much of the quarter generated a pick-up in two-way activity. An increase in liquidations was noted, although these remain a little way below their longer-term average levels. 

The sharp price recovery seen in October sparked a revival of investment demand early in Q4, but it remains to be seen whether full-year demand can exceed that of 2022.  

European bar and coin investment posted its weakest quarter since before the 2008 Global Financial Crisis. Demand sank to just 30t and posted its third consecutive significant y/y decline, slumping by 59%. Y-t-d demand is 58% behind the same period last year. The low net demand figure was due to a combination of both relatively subdued levels of buying and higher volumes of profit-taking/selling back than have been seen in recent years.

Rising interest rates across the region have not only made savings accounts relatively attractive to investors, but have also made themselves felt through punitive rises in mortgage payments, which, along with the cost of living crisis, has reduced funds available to invest in gold. 

As the largest market in the region, Germany was the biggest contributor to the region’s weakness, with demand down 73% to 12t. The domestic economic downturn, and uncertainty surrounding the government’s radical new green policies (which could force households to make costly upgrades to their heating systems), dented sentiment and made investors more cautious with investing. Other markets across the continent also saw sharp double-digit falls in Q3.

ASEAN markets

The ASEAN markets covered in GDT had mixed fortunes in Q3. Vietnam and Thailand witnessed y/y improvement, while demand in Indonesia weakened.

Demand in Vietnam was 4% higher y/y at 9t. Rising inflation and continued depreciation in the currency encouraged Vietnamese investors to seek refuge in gold, using the price correction during August as an entry point and with many anticipating further price strength. The premium on local gold bars jumped as a result.

Investment demand in Thailand rose 10% y/y to 11t. Local currency weakness and continued economic uncertainty helped to support demand. Thai investors used the price correction at the end of the quarter as an opportunity to buy at cheaper levels in anticipation of higher local prices over coming quarters.

Indonesia, in contrast, saw a 12% y/y fall in bar and coin investment to 7t. A relatively healthy domestic economic environment reduced safe-haven demand for gold. However, the end-September price drop saw a late revival of demand as investors bought into the dip.

Rest of Asia

Q3 saw Japan return to a very minor level of net disinvestment. But the overall net total was very small (-0.4t) and was indicative of modest levels of gross buying and limited liquidations. Stubbornly high domestic inflation, together with continued strength in the local gold price (due to the weak currency) has helped drive momentum in Japanese investment.

Demand is underpinned by the ongoing emergence of younger investors, who have shown a liking for regular saving using gold accumulation plans. This trend is partly due to the ease and convenience of these products and partly because these younger investors often lack the net worth to meet the minimum threshold inherent in physical purchases.

South Korean retail investors remained cautious in Q3. Demand of just over 3t was 16% lower y/y – the seventh consecutive y/y decline. Risk appetite remains low, despite local currency depreciation helping to support the local gold price during the quarter.


Australia saw a fourth consecutive decline in quarterly bar and coin demand. Q3 investment sank 58% to 3t, mirroring the weakness in European markets. Rising interest rates, continued cost of living pressures, and a relatively unexciting gold price during the quarter, all likely contributed to the subdued picture for gold investment.   


  1. On 14 September 2023 the premium of the Shanghai Benchmark Gold Price PM to the LBMA Gold Price AM rose to a record high of US$121/oz.

  2. The 2024 Chinese New Year falls between 9 and 15 February 2024.

  3. +51% over the year to end-September based on the LBMA Gold price PM in Turkish Lira. Source: Bloomberg

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