Geopolitical risks have been elevated in recent years
Spikes in geopolitical risk usually lead to equity market sell offs
Gold has been a proven safe-haven asset during geopolitical crises, delivering robust returns during these events.
Frequent tail events
Geopolitical risks spiked again recently (Chart 1). Ukraine's cross-border attack in early August, followed by Russia's largest air assault since the war began, has escalated the conflict. Meanwhile, the assassination of a Hamas political leader and subsequent retaliatory actions from Iran and Hezbollah have sharply increased geopolitical tensions in the Middle East.1 And most recently, waves of explosions in Lebanon and Israel’s declaration of “a new phase of war” have raised fresh geopolitical concerns in the region.2
Chart 1: A period of heightened risks
Five-day moving averages of the Geopolitical Risk Index (GPR)*
*As of 20 September 2024. Source: matteoiacoviello.com, Bloomberg, World Gold Council
The GPR Index indicates increasingly frequent periods when geopolitical risk is elevated – periods that have been particularly challenging for investors over the past three years. So far in 2024 the GPR Index has recorded 15 spikes – days when the Index surged by more than 100% – on the back of tensions in the Russia-Ukraine war and developments in the Middle East. This follows 31 spikes in 2023, 20 spikes in 2022 and 41 spikes in 2021.
Historical data tells us that when geopolitical risks stay elevated (typically above 100), global equities suffer – evidenced by the negative correlation between the GPR Index and global equity returns (Chart 2). Currently, the correlation between GPR and VIX is marching towards a record high.
Chart 2: Rising geopolitical risk leads to equity market selloffs
Rolling average GPR index and correlation with the VIX*
*Based on 12m rolling average of the GPR index and correlation between average monthly changes in the GPR Index and the MSCI World Index. As of August 2024. Source: matteoiacoviello.com, Bloomberg, World Gold Council
In fact, geopolitical risks have been front of mind for institutional investors for some time. Based on results from a survey we commissioned last year, geopolitical shifts and regional conflicts are identified by global investors – including Australian financial advisors – as the third and fourth biggest trends affecting their investment decisions (Chart 3).3 And geopolitical instability is one of the top concerns of global central banks when it comes to reserve management.
Chart 3: Geopolitical risks: one of the top concerns for global investors*
Q: Which of the following are the top two global trends affecting investments right now?
*Base: 75 North American Asset owners, 50 North American consultants, 400 North American Financial Advisors, 250 Australian Financial Advisors and 75 Asia Pacific Asset Owners. Source: ZoomRX, World Gold Council
Asset allocation implications
How have major assets fared so far this year? Gold has outperformed to date, surging by 28% (Chart 4). Global equities have delivered robust results too – while US stocks rocketed by 20%, the ASX 300 witnessed an 8% increase, mainly driven by factors such as the prospect of lower global interest rates ahead. But taking a closer look, when geopolitical risks spiked during April and August, equities fell back – impacted by multiple factors including surging geopolitical tensions – and gold rose higher.
Chart 4: Gold has held up during geopolitical risk spikes so far this year
Performance of indexed assets to date in 2024*
*As of 27 September 2024. Based on MSCI World Index, ASX 300 Index, Bloomberg Commodity Index, LBMA Gold Price PM, Bloomberg AusBond 0+ yrs Index and Bloomberg Barclay Global Agg Index. 1 January 2024 value = 100. Source: Bloomberg, World Gold Council
In almost every week during which the GPR index soared by over 100%, gold saw positive returns. Gold averaged a weekly return of 1.6% during these spikes while global equities declined, on average, by 0.8% (Chart 5).
Chart 5: Gold, a consistent outperformer during geopolitical crises
Performance of various assets during geopolitical risk spikes*
*Based on average weekly performances between January 1999 and September 2024 due to limitation of certain indices. Figures show when the GPR index during the week soared by 100% or more. Source: Bloomberg, World Gold Council
As our previous analysis demonstrates, geopolitical risks are a statistically significant variable that drives gold’s performance (Chart 6). Our monthly Gold Return Attribution Model (GRAM) shows that geopolitical risks have contributed 4.3% of gold’s return to date this year. Furthermore, our research shows that every 100-unit increase in the GPR Index corresponds to a 2.5% rise in the gold price.
Chart 6: Geopolitical risks have been a consistent contributor to gold’s return in 2024
Monthly GRAM results*
*Data to 31 August 2024. For more information, see: Gold Return Attribution Model | World Gold Council. Results shown here are based on analysis covering an estimation period from June 2019 to August 2024. We have reduced the estimated window to five year
Gold as an effective geopolitical risk hedge
Creating a resilient portfolio is a topic constantly explored by investors. We believe one of the keys to building this resilience is to prepare for “unknown unknowns”. While scenarios such as global economic growth can be deduced from economic data clues, geopolitical risks tend to be sudden and unpredictable. And these geopolitical tensions often lead to financial market turmoil, damaging investor portfolios.
When we examine how various assets respond to sudden geopolitical risk spikes, gold’s robust performance during such events becomes clear. We conclude that gold is an ideal hedge against unpredictable geopolitical shocks. This is further evidenced in our 2024 Central Bank Gold Survey, which revealed that geopolitical risk was a key driver that spurred on central banks in their recent record-breaking gold purchases (Chart 7).
Chart 7: Geopolitical risk-related concerns are driving the gold purchase decisions of global central banks
*Base: All central banks that hold gold (57); Advanced economy (18); EMDE (39). Ranked by “highly relevant” plus “somewhat relevant”. Source: World Gold Council
We believe that gold's key attributes – its safe-haven nature, its ability to generate long-term returns (especially now that a global easing cycle has begun), and its low correlation with risk assets – will continue to represent immense value to investors who seek to build a resilient portfolio in today’s world.
3The World Gold Council and State Street Global Advisors commissioned ZoomRX (formerly Vivisum) to survey 75 North American Asset owners, 50 North American consultants, 400 North American Financial Advisors, 250 Australian Financial Advisors and 75 Asia Pacific Asset Owners. Fieldwork was conducted between 20 October and 18 December 2023.
Those familiar with Gold Demand Trends – our market-leading quarterly report on global gold demand and supply – will know that gold buying in Germany has seen a pretty dramatic shift over the last couple of years. Just two years ago Germany was the second largest market for retail gold investment: it generated 185t of net bar and coin demand in 2022. That slumped to just 47t in 2023, and in the first half of this year retail investors bought a mere 5t of gold.
But there’s more to this data than meets the eye. For one thing, retail investment demand is measured on a ‘net’ basis. That is to say, it measures the balance of new gold investments versus what investors have sold back from existing holdings. We can’t infer from the data how many people hold gold relative to other investments. And it doesn’t tell us anything about why people may be buying less (and/or selling more).
So we ran some research to find out.
In Q2, we commissioned Toluna to run a 10-minute online survey of more than 3,000 German investors. Such a robust sample gives us a deep insight into the attitudes and motives driving investment behaviour, along with a hefty set of data to sift through. And the findings are encouraging. Spoiler alert: Germans are not falling out of love with gold.
Germany is a gold stronghold…
Gold is a widely held investment in Germany – 37% of German investors have invested in or held gold at some point. And, with 28% current ownership, it’s the third most commonly-owned investment after savings accounts (61%) and stocks/shares (46%).
Over one third of German investors have, at some point, invested in gold
% selecting each option
SQ6: Which of the following have you ever held or invested in? Base: Total respondents, 3,010. Source: Toluna, World Gold Council
…where investors have a clear recognition of its key investment characteristics.
When we look into why Germans are so keen to invest in gold, their reasons for doing so are well aligned with our case for gold as a strategic asset. Aside from the fact that it’s possible to buy gold in small amounts, the top motives for investing are that it protects against inflation, is easy to buy and sell, gives a better long-term return than cash held in a savings account, and helps to spread risk and diversify their portfolio. German investors are, it seems, well versed in gold’s unique investment attributes.
German investors have clear motives for buying gold
% selecting 'Strongly agree' or 'Somewhat agree'
Q8C Please indicate how much you agree or disagree with the following statements for why you invest in gold. 5-point scale: Strongly agree; Somewhat agree; Neither agree nor disagree; Somewhat disagree; Strongly disagree. Base: Ever invested in gold, 1114, (men 717; women 394). Source: Toluna, World Gold Council
Gold has provided a safety net for German investors in recent years
So how does this tally with the recent lull in overall levels of gold investment demand in Germany? The country’s gloomy economic landscape has punctured investor confidence: the ZEW Institute’s expectations index plunged to 3.6 in September, from 19.2 the previous month – its lowest in almost a year. And this is reflected in the data around why people in Germany have been selling gold in recent years.
Of the 1,114 respondents who have ever invested in gold, 13% said they had sold either part or all of their gold investment since the beginning of 2023. The top reason for doing so was that they 'wanted to realise gains from the higher price'. But almost a quarter said they sold gold 'to free up funds to make a big purchase' and one fifth sold because 'it was an easy way to get some spare cash'. And notably, 18% of those who have sold gold since the start of 2023 did so because they 'needed the money to supplement my income, due to the higher cost of living'.
Recent gold selling driven by a need to realise gains and access funds
% selecting each option
Q30B - What would you say are the main reasons you sold your gold investment? Base: Sold since the start of 2023, 147 (men 98, women 49). Source: Toluna, World Gold Council
But what does the future hold?
Importantly though, this wave of disinvestment does not spell the end of Germany’s love for gold. Most of the recent sellers held onto some of their gold: 65% of those who have sold since the start of 2023 sold only part of their investment. This could reflect the strong belief that 'Keeping cash and physical assets is the safest way to protect one's wealth' (68% selected this as a reason for why they invest in general).
German investors, on balance, say they are likely to invest in gold in the future
% selecting each option
Q11.How likely are you to invest in gold in the future? (7-point scale) Base: Total respondents, 3010. Source: Toluna, World Gold Council
More importantly, German gold investors tend to be loyal, repeat buyers. Very few of the 3,010 respondents said they either 'Definitely will not' (5%) or are 'Very unlikely' (7%) to invest in gold in the future. This compares with 12% who 'Definitely will invest' and 20% who are 'Very likely' to; and 25-34 year old men are the most likely to say they will definitely invest in the future. Even those who have sold gold are very open to buying again; notably, none of the 147 respondents who have sold gold since 2023 ruled out a future investment.
Potential future gold returns, geopolitical risks, diversification benefits and falling interest rates are among the top factors that play into this likelihood of making future investments in gold.
The research gives us a sneak peek into the minds of German investors and the way they feel about gold. And, while the last couple of years have been challenging for gold demand in absolute terms, the evidence suggests that the relationship has very solid foundations.
Bringing more people into the financial system is a priority for policymakers across the world.
Introduction
Boosting financial inclusion, or access to formal banking services, has become a major policy objective for governments, NGOs and international organisations across the world. Financial inclusion is often defined as allowing people to access savings products, credit, insurance, and payments systems. Access to formal financial services is important as financial security is key for economic growth and development – when individuals and households are financially secure, they are more likely to invest or start businesses, further supporting economic development.
Gold plays a hugely important role in individual and household finances for many. It can bring the financial security needed to start a business, or help individuals meet unexpected costs such as healthcare expenses. Often seen as a long-term asset it can also help ensure financial freedom in retirement. But there are other benefits too, including financial system stability and expanding access to other banking products. Where consumers trust and understand gold, retail banks have an opportunity to offer gold-backed banking products to appeal to a larger range of consumers. The World Gold Council is starting a new article series to explore these issues and bring awareness to the role that gold plays in households around the world.
Financial inclusion – the status quo
In the latest World Bank Global Fidex Report, published in 2021, the average bank account penetration rate in emerging markets was 71%, while77% globally have access to a bank account. This is a significant improvement on the 51% that had access to banking services in 2011. Despite these improvements in access to financial services, financial inclusion remains a major priority. This is why the G20 launched a new financial inclusion action plan just last year. At its heart is harnessing digital technology to improve access to formal financial services. Where bricks and mortar banks sometimes struggled to expand access through a physical branch network, the digitalisation of finance has facilitated access to hard-to-reach consumers. The same is happening in the gold market – over the last decade we have seen the development of new digital gold products that allow individuals to buy, manage, and sell gold online.
Financial inclusion - building steam
Across the world there is a rapid embrace of initiatives assisting the drive for financial inclusion. Part of this is offering a range of innovative financial products. In many markets including China, Singapore, UAE, and Malaysia retail banks are offering gold investment accounts, tapping into a natural, cultural affinity for gold. Turkey is perhaps the ‘gold standard’ with a range of gold-based products now offered by retail banks including investment accounts, buy-back schemes, gold bonds, and gold cheques, amongst others.
Financial inclusion is not just about access. It is also about appeal. The range of products on offer have to interest consumers to attract them into the banking system. “We are at an interesting inflection point where digital gold will also become a part of this process. It would add an additional dimension to financial inclusion not present with the existing set of financial instruments,” said Professor Arvind Sahay, former chairperson of the India Gold Policy Centre (IGPC).
Can gold break down the barriers to financial inclusion?
Where access to bank accounts is low, gold can—and often does—fill the gap. This is particularly the case for under-served and marginalised communities, including women, rural populations and the working poor.
Barriers to financial inclusion include a lack of access brought by infrastructure challenges, and also a lack of trust in the formal banking system. The value proposition is clear: If banks offer gold products, consumers are more likely to come into the banking system, expanding financial inclusion. It could also lead to better outcomes for gold consumers – banks are regulated entities and are often better able to leverage economies of scale, so efficiencies that can be passed on to the end consumer.
This isn’t just about selling gold though. It is also about putting it to work. The potential for gold as collateral has been floated in many countries for some time. Allowing banks to accept gold deposits could potentially bring previously unbanked people into the formal economy, enabling them to accumulate savings and apply for loans and other financial services. This is a model that could be adopted in many markets, including in lower-income ASEAN countries, which is a region with significant gold consumption.
Gold in the ASEAN region
Gold has a long-established foothold in ASEAN economies. In 2023, the World Gold Council’s Gold Demand Trends research showed that over 170 tonnes of gold was consumed in the ASEAN region. “Gold is deeply cultural across ASEAN," said Professor Sahay, former chairperson of the IGPC. “People buy it as a store of value, as jewellery, and a form of transmission of wealth from one generation to the next”.
The region isn’t just a major consumer of gold. Indonesia and the Philippines are home to significant gold mining operations, Singapore is a major trading and refining centre, and the jewellery created in Thailand and Indonesia are prized around the world for their craftsmanship, forward-thinking designs, and value for money.
In Vietnam – the largest gold consumer in ASEAN – there are a number of drivers behind gold demand. Our consumer research (published in 2021) showed that 81% of Vietnamese view gold as a safeguard against political and economic uncertainty. It is seen by a similar number of respondents as bringing financial security in the long term, and a majority of those surveyed trusted it more than fiat currencies. “Gold tael bars and gold chi rings are the most preferred tools for saving as they can easily be traded for cash at more than 10,000 shops nationwide or used as collateral for capital loans from banks and other financial institutions,” said Huynh Trung Khanh, deputy chairman, Vietnam Gold Traders Association.
In other markets in the region, including Indonesia and Malaysia, gold pawning is also a huge business, facilitating access to credit for individuals and small businesses. Indonesia’s biggest pawn shop operator, PT Pegadaian, is state-owned. Indonesia is also home to several popular digital gold platforms that facilitate gold transactions in small denominations. It also launched a blockchain-based, precious metals-backed payments and savings platform outside of the banking system to increase financial inclusion in 2021. Developed by Indonesia's state-owned postal service, PT Pos, and foreign token provider, Kinesis, PosGo is the country’s first Sharia-compliant mobile platform. It allows users to trade gold and silver, as well as save, transact and manage their wealth in digital tokens without the need for bank accounts.
In many countries gold has both a financial role, and a cultural significance - and the interplay of the two drives consumer interest. “Gold jewellery products, such as 24K bangles and necklaces, are popular gifts for Vietnamese brides in the wedding season and newborn infants on their first birthdays. Gold bars and chi rings are also in great demand during the Vietnamese new year Tet festival, particularly on the God of Wealth day (tenth day of the new year)”, according to Huynh Trung Khanh, deputy chairman, Vietnam Gold Traders Association. Gold is used to celebrate major family milestones in Thailand too. “Gold is a popular choice for wedding, birthday and newborn celebrations,” says Pawan Nawawattanasub, member of the Board of Directors, Thai Gold Traders Association.
Conclusion
Gold meets both financial and cultural needs. As a long-term store of value, an asset that is easy to buy and sell, and an asset that can provide protection against risk and uncertainty, giving consumers financial security. It can directly and indirectly help achieve the public policy objective of maximising financial inclusion:
Meeting the objectives of financial inclusion
Financial inclusion parameter
Role of gold
Access to savings products
Gold can be a long-term store of value, protecting wealth. It is easily bought and sold.
Access to credit
Gold can be used as collateral for micro or enterprise lending. In Indonesia, for example, a network of state-owned gold pawn shops provide credit to individuals across the country.
Access to payment systems
Gold, particularly in digital form, is used for P2P payments. Turkey has led the development of gold payments systems.
Access to insurance
Gold is a strategic component of investment portfolios and can help maximise risk-adjusted returns including for pension and insurance funds. At an individual level, gold was used to meet unexpected medical bills during the COVID pandemic in Thailand.
Strengthening the banking system
Gold is trusted and understood by many. In our global retail market insights research, 61% of consumers across the countries we studied trust gold more than currencies. 65% believe gold will never lose its value over the long term, and 67% view gold as being a good safeguard against inflation and currency fluctuations. By offering gold products, retail banks could expand their appeal. The banks in Turkey have long recognised this, and gold has been key to ensuring consumers remain formally banked. Gold can bring new product and commercial opportunities and can help strengthen the bank-to-consumer relationship.
In addition to the commercial opportunities gold can bring to the banking system, it can help improve it. Central banks have long recognised the importance of gold as a monetary system stabiliser. As a liquid asset that is easily traded, gold can strengthen proprietary balance sheets, further enhancing the attractiveness and appeal of the banking system.
This first blog is intended to set the scene and introduce some of the motivations for buying gold, and its role in individual and household finances. Over the coming months we will be publishing a series of in-depth articles focussing on specific countries, starting with Egypt.
China has recently announced aggressive stimuli to shore up consumer confidence and support growth
Based on our models we believe the potential improvement in GDP will benefit gold demand in China
However, gold investment appetite may face competition from other assets including equities and property as the economy recovers.
China’s stimulus bazooka
China shocked the world with the announcement of its recent and most aggressive stimuli since COVID, designed to support the economy and boost household confidence. The long-awaited and stronger-than-expected package, announced by the People’s Bank of China (PBoC), ranges from various rate cuts and downpayment ratio reductions to measures that will support the equity market.1
And on top of all this, China has recently announced additional fiscal policy support, including increased special government debt issuance to help low-income households and enhance state-owned commercial bank capital, as well as support that will help local government resolve hidden debt issues.2 New measures to further revive the housing market including another loan prime rate cut were also announced most recently. 3
Equity market sentiment improved
Stocks cheered in response (Chart 1). The CSI300 Stock Index jumped by 16% when the stimuli were announced in the last week of September – its strongest weekly performance since November 2008. Meanwhile, Chinese equities attracted net inflows of 252bn yuan, the largest weekly volume on record.4 And while market volatility rose sharply following the early October National Day Holiday, trading volumes and investor sentiment towards Chinese equities generally stayed elevated.
Chart 1: Despite recent volatility, investors are generally in a cheerful mood
China’s Shenzhen and Shanghai 300 Stock Index and daily turnover*
*As of 18 October 2024. Source: Bloomberg, World Gold Council
What does this mean for gold demand in China?
The recent measures are likely to provide support for China’s economic growth. A reduced mortgage burden along with various other measures designed to revive the property sector could boost consumer and investor confidence. This is borne out by the fact that institutions have raised their expectations for China’s GDP growth in 2024.5
The anticipated rebound in economic growth will likely boost China’s gold demand. And as the largest components of that demand, we believe gold jewellery and bar and coin will be impacted the most (Chart 2).
Chart 2: Gold jewellery and bullion investment drive Chinese retail gold demand
Gold demand composition in 2023 and the 10-year average*
*10-year average based on the average between 2014 and 2023. Note that gold jewellery demand figures are net of recycling, assuming all recycling supply comes from the jewellery sector.
Source: Metals Focus, World Gold Council
We have noted in previous reports that China’s gold demand has been under pressure. In fact, gold withdrawals from the Shanghai Gold Exchange (SGE) – a proxy of China’s wholesale demand – have remained well below their long-term average (Chart 3). While the surging gold price has helped sustain some investment buying, it has hampered gold jewellery consumption. And the pessimistic outlook for China’s economy has also limited household spending on gold.
Chart 3: 2024 Chinese gold demand is below its long-term average
Monthly gold withdrawals from the SGE and the 10-year average
Source: Shanghai Gold Exchange, World Gold Council
But the aggressive stimuli should provide tailwinds. Our analysis shows that economic growth is the fundamental driver of Chinese gold demand (Chart 4). More specifically, every one percentage point increase in China’s annual GDP growth leads to a 5.2% rise in gold jewellery consumption and a similar 5.1% increase in bar and coin buying, holding all else constant.
Chart 4: In general, good economic news = good gold consumption news
Annual GDP growth and annual growth in gold jewellery demand (left) & bar and coin investment (right)*
*Based on annual Chinese gold jewellery demand, bar and coin investment and GDP between 2000 and 2023. Source: Metals Focus, Bloomberg, Shanghai Gold Exchange, World Gold Council
But there are other considerations. The level of the local gold price and the number of weddings are other main factors that impact gold jewellery consumption. Also, our analysis shows that, other than GDP, every 1% increase in the value of local equities reduces gold investment demand by 0.4% as enhanced investor risk appetite tends to limit safe-haven demand for gold (Chart 5). Finally, while limited historical data limits our ability to quantify the effect for gold ETFs, we anticipate investment in this sector may also face competition from equities and other risk assets – and the gold price will continue to be a key factor impacting gold ETF flows in China.
Chart 5: Usually, strong equity performance distracts investors from bar and coin investment
Annual stock returns and bar and coin demand change*
*Based on annual changes in bar and coin as well as Shanghai Composite Stock Index between 2000 and 2023. Source: Wind, Metals Focus, World Gold Council
Summary
Although it may take some time for the economy to fully digest the positive impact of the current and potential future stimuli, we believe improved consumer confidence and GDP growth should bode well for China’s gold demand in general.
That said, other factors such as the gold price, the number of weddings, changes in young consumers’ tastes, as well as the industry’s consolidation – as mentioned in our recently published 2024 Chinese Gold Jewellery Retail Insights – are also vital drivers of local gold jewellery demand.
Furthermore, as investors perceive a brighter economic future and competing assets, such as property, come into focus, the needle for bar and coin investment is also likely to shift.
Gold has been a fascinating accessory, a proven store of value and long treated as the symbol of good luck to China. And we believe its relevance in Chinese consumers’ daily lives as well as in local investors’ portfolios will continue to shine. We will keep a close eye on future developments and provide more detailed analysis as needed.
Gold made further gains in October, smashing through previous record highs to finish up 4.0% at US$2,734/oz (Table 1).
The rally occurred amid unusual mutual gains in the US dollar, bond yields and equities. This was reflected in the large residual shown in our Gold Return Attribution Model (GRAM) – see Chart 1. According to GRAM, yield- and FX-related opportunity cost factors were a drag on the price alongside momentum, with only risk and uncertainty – and the ever present economic expansion – contributing positively to its return, via a combination of higher breakeven inflation and geopolitical risk.
Chart 5 shows that much of gold’s price action took place during late Asian/early European trading hours. This at least partly explains the increasingly frequent disconnect between gold’s return and its usually reliable – yet US-centric – short-term drivers of rates and the US dollar. A risk premium ahead of US elections is also a likely driver. Global gold ETFs experienced further inflows in October led by the US and China, but North American inflows (30t as of 31 October) were more than offset by COMEX futures positions, which pared 40t over the month, lending credence to the idea that October was mostly an Asia story.
Table 1: No let up for gold’s strong run in October, reflected in major currencies as the US dollar also gained
Performance of gold in various currencies*
*Data to 31 October 2024. Based on the LBMA Gold Price PM in USD, expressed in local currencies. Source: Bloomberg, ICE Benchmark Administration, World Gold Council
Chart 1: Gold bucked strength in the US dollar and Treasury yields, as geopolitical and high Asian hours activity drove returns in October
Multifactor model detailing attribution of gold’s drivers on its monthly returns*
*Data to 31 October 2024. Our Gold Return Attribution Model (GRAM) is a multiple regression model of gold price returns, grouped into four thematic driver categories of gold’s performance: economic expansion, risk & uncertainty, opportunity cost, and momentum. These themes capture motives behind gold demand; most importantly, investment demand, which is considered the marginal driver of returns in the short run. ‘Residual’ captures the share of gold returns that is not explained by factors already included. Results shown here are based on analysis covering an estimation period from October 2019 to October 2024. We have reduced the estimated window to five years to better reflect current conditions. Source: Bloomberg, World Gold Council
Gold and the US election
US elections take place this week and could spark some volatility across markets. There is probably little to be gained in having conviction in asset trajectories during such a polarised and binary event, so we suspect that many investors quite like the safety of gold and other hedges in such circumstances.
Our recent analysis found no discernible pattern in gold’s near-term reactions to past elections. It was only when the dust settled and policy shifts – both fiscal and monetary – became clear, that gold took its cues. We remain of the opinion that the fiscal plans proposed under both administrations will continue to attract investors to gold.
Let’s tally the rally
As we are delaying our Gold Market Commentary until after the election, we wanted to provide an early look back at gold’s phenomenal run in 2024 – by the numbers.
Top performer
Gold has had a stellar year as one of the best performing assets in 2024, made all the more remarkable given a positive performance by risk assets, a stronger US dollar and elevated bond yields (Chart 2). The price was boosted by:
Resilient-to-strong Asian demand including Chinese bar and coin buying and Indian buyers taking advantage of import duty cuts. Our most recent Gold Demand Trends report lays this out nicely
Geopolitical tension - from significant elections to conflict in the Middle East – encouraging buying and restraining the selling back of gold.
Chart 2: Gold has been one of the best performing assets in 2024
Y-t-d performance of various assets, in US$
*Data from 1 January 2024 to 31 October 2024 Source: Bloomberg, World Gold Council
Higher highs
Gold has posted 39 new all-time highs in US dollars this year, second only to 1979 (57) and closely followed by 1972 (38) and 2011 (38) (Chart 3). March, September and October saw the largest number of new highs (8). These may be throwaway statistics to some but they often matter in driving media coverage and sentiment: who doesn’t like reading about records being broken? But, there are some noteworthy differences. For one, previous record-setting years have been accompanied by strong investment demand. Gold ETF inflows in Western markets are very late to the party this year, and retail investment demand has not picked up much either. Furthermore, media fervour is not as visible today as it was during 2020 when gold made its first new all-time-highs for nigh-on a decade, suggesting perhaps that this time, sentiment has not gotten carried away (Chart 4).
Chart 3: Gold has made 39 new highs, the second highest annual tally on record
Gold price and new all-time-high closes*
*Data from 31 December 1971 to 31 October 2024. Source: Bloomberg, World Gold Council
Chart 4: Repeated new highs have failed to excite media as much as during the 2020 run-up
News, social media and Bloomberg word search for “gold”
Source: Bloomberg
Time is of the essence
The largest contributions to returns during October were recorded during Asian trading hours (Chart 5). Yet most of gold’s volatility occurred during European and US sessions (Chart 6), consistent with the narrative of emerging market investors and central bank buying helping to drive prices higher even as trading in Western markets, as it tends to do, creates the most short-term noise.
Chart 5: Gold’s return has been driven mostly during Asian trading hours in 2024 – and notably in October
*Data from 1 January 2024 to 31 October 2024. Gold spot mid-price at 20-minute intervals. Sessions: Asia 2200 to 1100 UTC, Europe: 1100 to 1400 UTC, US: 1400 to 2200. Asia session runs from 22:00 UTC to 1100 UTC, overlapping with normal European trading hours, given that much of larger Asia gold trade is likely to take place at the LBMA AM benchmark price at 1100 UTC. Asian trading hours remain the largest contributor, albeit to a lesser extent if we end the session at 0700 UTC. Source: Factset, World Gold Council
Chart 6: Returns have been dominated by the East, volatility by the West
*Data from 1 January 2024 to 31 October 2024. Volatility is calculated as the annualised volatility of 20-min log returns per session. Sessions: Asia 2200 to 1100 UTC, Europe: 1100 to 1400 UTC, US: 1400 to 2200. Asia session runs from 22:00 UTC to 1100 UTC, overlapping with normal European trading hours, given that much of larger Asia gold trade is likely to take place at the LBMA AM benchmark price at 1100 UTC. Asian trading hours remain the largest contributor, albeit to a lesser extent if we end the session at 0700 UTC. Source: Factset, World Gold Council
The big little rally
If we look back before 2024 to where the current rally began, while impressive, it ranks quite poorly compared to historical bull runs – having been both lower in magnitude and duration than all except the rally of 1983 (Chart 7). This stands to reason given the reluctance of many Western investors to join the fray; some perhaps having misjudged the reasons for the rally and others fearing they have missed it altogether.
Chart 7: The rally is impressive but ranks low compared to previous run-ups
Gold price and bull market rallies since 1971*
*Data from 31 December 1971 to 31 October 2024. Bull market start and end points defined using SciPy ‘argrelextrema’ package on a smoothed price series with conditions of minim run duration of 26 weeks and return of 20%, followed by a minimum 20% pullback prior to next local minimum. Source: Source: Bloomberg, World Gold Council
In summary
It has been a strong run for gold in 2024, dominated by Asian hours trading. Central banks, emerging market bar and coin as well as other investors have been instrumental in driving up prices even in the face of strong US Treasury yields, a firm US dollar and hitherto reluctant Western investors. But it’s worth noting that:
The run ranks low in relation to previous rallies
Media coverage and Western investor participation has been lower than during 2020, for example, when gold breached new highs for the first time in over a decade, suggesting sentiment isn’t overly stretched
Futures markets net long exposure is extended, but is a considerably weaker forward indicator for gold price trajectories than extended net shorts
The conditions remain for demand to continue to impress including elevated geopolitical risk, overvalued equity markets, low Western investor gold ownership and central bank buying.
In this episode of Unearthed, hosts John Reade and Joe Cavatoni discuss the latest gold market trends, reflecting on the U.S. election outcome, monetary policy, and China’s recent economic developments. They highlight record-breaking gold demand, central bank buying, and shifting global economic dynamics influencing gold prices (more via Gold Demand Trends Q3 2024).
They explore how geopolitical uncertainties, inflation concerns, and market corrections are shaping investment strategies worldwide. With gold’s role in China's investment market and Western investors returning to risk assets, this episode unpacks the critical factors driving gold’s future.
Diversification does not guarantee any investment returns and does not eliminate the risk of loss. Past performance is not necessarily indicative of future results. The resulting performance of any investment outcomes that can be generated through allocation to gold are hypothetical in nature, may not reflect actual investment results and are not guarantees of future results. The World Gold Council and its affiliates do not guarantee or warranty any calculations and models used in any hypothetical portfolios or any outcomes resulting from any such use. Investors should discuss their individual circumstances with their appropriate investment professionals before making any decision regarding any Services or investments.
This information may contain forward-looking statements, such as statements which use the words “believes”, “expects”, “may”, or “suggests”, or similar terminology, which are based on current expectations and are subject to change. Forward-looking statements involve a number of risks and uncertainties. There can be no assurance that any forward-looking statements will be achieved. World Gold Council and its affiliates assume no responsibility for updating any forward-looking statements.
Information regarding QaurumSM and the Gold Valuation Framework
Note that the resulting performance of various investment outcomes that can be generated through use of Qaurum, the Gold Valuation Framework and other information are hypothetical in nature, may not reflect actual investment results and are not guarantees of future results. Neither World Gold Council (including its affiliates) nor Oxford Economics provides any warranty or guarantee regarding the functionality of the tool, including without limitation any projections, estimates or calculations.
Demand for gold used in electronics peaked in 2010 at 328t, steadily falling to 249t in 2023. In recent quarters, however, this sector has seen a modest recovery. And we’ve received a raft of questions around how much of that recovery can be explained by the growth of Artificial Intelligence, whether it will continue to drive growth in the sector and why exactly AI is an important emerging area of demand for gold.
Gold in electronics: a recent history
Gold plays a crucial role in electronic devices: it is an excellent conductor of electricity; it does not corrode; and its physical and chemical properties allow it to be manipulated into extraordinarily thin wires and reliable coatings. These properties make it an indispensable component of the computer chips found in almost all electronic equipment.
The surging price of gold between 2001 and 2011 (from ~US$250/oz to over US$1,800/oz) encouraged manufacturers in the electronics industry to look for ways to reduce their gold usage. These strategies involved both substitution (replacing gold with alternatives such as silver and copper) and thrifting (using smaller and smaller quantities of gold).1
Chart 1: Manufacturers reduced gold usage in response to the price rise
Gold used in electronics, in tonnes, and the annual average gold price, in US$/oz*
*Data as at 30 September 2024. Source: ICE Benchmark Administration, Metals Focus, Refinitiv GFMS, World Gold Council
But retooling and process development does not happen overnight in electronics fabrication facilities; indeed, it is a multi-year process. And this shift coincided with consumer demand for ever more powerful, functional and reliable devices powered by advanced electronics and increasingly complex chips – think the proliferation of now-ubiquitous smartphones and the vast growth in laptops, smart TVs, electric vehicles…the list goes on. Manufacturers had to balance cost reduction with gold’s indispensable role as they addressed the growing need for high-end, durable components during this unprecedented period of “electrification”.
The role of gold in AI
AI is fast becoming a cornerstone of modern technology, driving advancements across various industries. The considerable electronics infrastructure required to power this rapidly growing sector has a direct impact on industrial gold demand.
As outlined above, gold is an essential component in the manufacturing of AI-enabled devices. AI systems rely heavily on advanced hardware, including processors, memory chips and sensors, all of which utilise gold. AI-enabled devices, such as smartphones and autonomous vehicles, alongside a corresponding growth in data centres, has created an exponential rise in the need for highly efficient and reliable electronic components. Gold's superior conductivity ensures that data can be processed and transmitted at high speed with minimal energy loss. Furthermore, gold's resistance to corrosion ensures component longevity and durability – critical for continuous and intensive AI applications.
As AI technology advances, the demand for more sophisticated and powerful hardware can only increase. This, in turn, is likely to drive demand for gold, as manufacturers seek to enhance the performance and reliability of their AI-enabled devices. Meanwhile, sectors such as healthcare and finance are looking to AI in order to improve efficiency and innovation, and this can only further amplify demand.
Chart 2: AI-proliferation has aided the recent recovery in gold usage
Gold used in technology applications, in tonnes, and the quarterly average gold price, in US$/oz*
*Data as at 30 September 2024 Source: ICE Benchmark Administration, Metals Focus, World Gold Council
But once again manufacturers face the challenge that catalysed the earlier wave of gold substitution and thrifting: cost. With gold recently reaching all-time highs of over US$2,700/oz, manufacturers are bound to face renewed pressure to evaluate how they use gold. But the situation today is very different to that of 2010 in that most of the “easy” thrifting and substitution has already been implemented; there is a limit to how thin wires and coatings can be and it is highly likely that they are already close to – if not at – that point. Additionally, as technologies evolve, some of gold’s traditional uses may slowly wane; one example is the ongoing changes in the LED sector where gold-free mini-LEDs are slowly usurping the gold-containing incumbents.
So what does this mean for the future of gold demand in the technology sector?
Gold's role beyond AI
While the electronics industry still dominates demand for gold in the technology sector, it is far from the only application that relies on this precious metal. Gold's versatility and unique properties make it indispensable in various other areas of technology:
Medical devices: gold is used in many therapeutic devices, such as implants, where it is valued for its biocompatibility and resistance to bacterial colonisation. Gold nanoparticles are also critical in the medical diagnostics field and are being trialled as potential drug delivery devices.
Aerospace: gold is used in the production of critical components for satellites and spacecraft. Its ability to withstand extreme temperatures and its reflective properties make it ideal for protecting sensitive equipment from radiation and heat.
Clean technologies: gold is an excellent chemical catalyst and a promising candidate material in the production of clean hydrogen and carbon dioxide transformation.
In conclusion, gold will continue to be a critical component in the electronics industry, with AI applications bolstering its demand in the near term. But in this cost-driven sector manufacturers will continue to innovate and this will inevitably impact how gold is used in certain applications. Beyond electronics, gold’s unique properties make it a valuable resource across multiple areas, ensuring its continued relevance in the ever-evolving technology landscape.
1Substitution occurred almost entirely at the lower end of the market, especially where safety or device longevity was less of a consideration (neither silver nor copper are corrosion resistant, making failure more likely). Thrifting was more widespread across the industry, facilitated by thinner gold wires and coatings, and by a more careful management of gold usage during the manufacturing process.
Gold performed exceptionally well in 2024, outperforming all major asset classes and proving to be a strong portfolio diversifier. Over the course of the year the LBMA Gold Price PM set 40 new all-time highs (ATH), the most recent of which was US$2,777.80/oz on 30 October.
Gold rose 25.5% in 2024, likely due to its role as an effective hedge against the heightened geopolitical uncertainty and market volatility experienced this year.
According to our Gold Return Attribution Model, gold’s positive performance was linked to the following key factors:
Strong central bank and investor demand, which offset declining consumer demand
Heightened geopolitical risk due to increased conflicts, along with a busy electoral year across the world
Periods of opportunity costs when markets saw lower yields and a weakening US dollar.
Market consensus expectations suggest a more modest performance for gold in 2025, but with the potential for upside catalysts as the year unfolds. As you prepare for the year ahead, take a look at our 2025 Outlook where we outline potential scenarios and their impact on gold.
Chart 1: Gold outperformed all major asset classes in 2024
*Data as of 31 December 2024. Indices used Bloomberg Barclays Global Treasury ex US, Bloomberg Barclays US Bond Aggregate, ICE BofA US 3-Month Treasury Bills, New Frontier Global Institutional Portfolio Index, MSCI World ex US Total Return Index, Bloomberg Commodity Total Return Index, MSCI EM Total Return Index, LBMA Gold Price PM (USD/oz), MSCI US Total Return Index.
Source: Bloomberg, ICE Benchmark Administration, World Gold Council
Asset allocation implications in today’s chaotic world
Ray Jia
Head of Research (Asia Pacific, ex-India) and Deputy Head of Trade Engagement (China) World Gold CouncilMarissa Salim
Senior Research Lead, APAC World Gold CouncilFrequent tail events
Geopolitical risks spiked again recently (Chart 1). Ukraine's cross-border attack in early August, followed by Russia's largest air assault since the war began, has escalated the conflict. Meanwhile, the assassination of a Hamas political leader and subsequent retaliatory actions from Iran and Hezbollah have sharply increased geopolitical tensions in the Middle East.1 And most recently, waves of explosions in Lebanon and Israel’s declaration of “a new phase of war” have raised fresh geopolitical concerns in the region.2
Chart 1: A period of heightened risks
Five-day moving averages of the Geopolitical Risk Index (GPR)*
*As of 20 September 2024. Source: matteoiacoviello.com, Bloomberg, World Gold Council
The GPR Index indicates increasingly frequent periods when geopolitical risk is elevated – periods that have been particularly challenging for investors over the past three years. So far in 2024 the GPR Index has recorded 15 spikes – days when the Index surged by more than 100% – on the back of tensions in the Russia-Ukraine war and developments in the Middle East. This follows 31 spikes in 2023, 20 spikes in 2022 and 41 spikes in 2021.
Historical data tells us that when geopolitical risks stay elevated (typically above 100), global equities suffer – evidenced by the negative correlation between the GPR Index and global equity returns (Chart 2). Currently, the correlation between GPR and VIX is marching towards a record high.
Chart 2: Rising geopolitical risk leads to equity market selloffs
Rolling average GPR index and correlation with the VIX*
*Based on 12m rolling average of the GPR index and correlation between average monthly changes in the GPR Index and the MSCI World Index. As of August 2024. Source: matteoiacoviello.com, Bloomberg, World Gold Council
In fact, geopolitical risks have been front of mind for institutional investors for some time. Based on results from a survey we commissioned last year, geopolitical shifts and regional conflicts are identified by global investors – including Australian financial advisors – as the third and fourth biggest trends affecting their investment decisions (Chart 3).3 And geopolitical instability is one of the top concerns of global central banks when it comes to reserve management.
Chart 3: Geopolitical risks: one of the top concerns for global investors*
Q: Which of the following are the top two global trends affecting investments right now?
Asset allocation implications
How have major assets fared so far this year? Gold has outperformed to date, surging by 28% (Chart 4). Global equities have delivered robust results too – while US stocks rocketed by 20%, the ASX 300 witnessed an 8% increase, mainly driven by factors such as the prospect of lower global interest rates ahead. But taking a closer look, when geopolitical risks spiked during April and August, equities fell back – impacted by multiple factors including surging geopolitical tensions – and gold rose higher.
Chart 4: Gold has held up during geopolitical risk spikes so far this year
Performance of indexed assets to date in 2024*
In almost every week during which the GPR index soared by over 100%, gold saw positive returns. Gold averaged a weekly return of 1.6% during these spikes while global equities declined, on average, by 0.8% (Chart 5).
Chart 5: Gold, a consistent outperformer during geopolitical crises
Performance of various assets during geopolitical risk spikes*
As our previous analysis demonstrates, geopolitical risks are a statistically significant variable that drives gold’s performance (Chart 6). Our monthly Gold Return Attribution Model (GRAM) shows that geopolitical risks have contributed 4.3% of gold’s return to date this year. Furthermore, our research shows that every 100-unit increase in the GPR Index corresponds to a 2.5% rise in the gold price.
Chart 6: Geopolitical risks have been a consistent contributor to gold’s return in 2024
Monthly GRAM results*
*Data to 31 August 2024. For more information, see: Gold Return Attribution Model | World Gold Council. Results shown here are based on analysis covering an estimation period from June 2019 to August 2024. We have reduced the estimated window to five year
Gold as an effective geopolitical risk hedge
Creating a resilient portfolio is a topic constantly explored by investors. We believe one of the keys to building this resilience is to prepare for “unknown unknowns”. While scenarios such as global economic growth can be deduced from economic data clues, geopolitical risks tend to be sudden and unpredictable. And these geopolitical tensions often lead to financial market turmoil, damaging investor portfolios.
When we examine how various assets respond to sudden geopolitical risk spikes, gold’s robust performance during such events becomes clear. We conclude that gold is an ideal hedge against unpredictable geopolitical shocks. This is further evidenced in our 2024 Central Bank Gold Survey, which revealed that geopolitical risk was a key driver that spurred on central banks in their recent record-breaking gold purchases (Chart 7).
Chart 7: Geopolitical risk-related concerns are driving the gold purchase decisions of global central banks
We believe that gold's key attributes – its safe-haven nature, its ability to generate long-term returns (especially now that a global easing cycle has begun), and its low correlation with risk assets – will continue to represent immense value to investors who seek to build a resilient portfolio in today’s world.
Footnotes
1For more, see: What happened in Iran and what we know about assassination of Ismail Haniyeh | CNN
2For more, see: Second wave of explosions hits Lebanon a day after pager attack | AP News
3The World Gold Council and State Street Global Advisors commissioned ZoomRX (formerly Vivisum) to survey 75 North American Asset owners, 50 North American consultants, 400 North American Financial Advisors, 250 Australian Financial Advisors and 75 Asia Pacific Asset Owners. Fieldwork was conducted between 20 October and 18 December 2023.
Gold has all the hallmarks of a keystone German investment
Louise Street
Senior Markets Analyst World Gold CouncilThose familiar with Gold Demand Trends – our market-leading quarterly report on global gold demand and supply – will know that gold buying in Germany has seen a pretty dramatic shift over the last couple of years. Just two years ago Germany was the second largest market for retail gold investment: it generated 185t of net bar and coin demand in 2022. That slumped to just 47t in 2023, and in the first half of this year retail investors bought a mere 5t of gold.
But there’s more to this data than meets the eye. For one thing, retail investment demand is measured on a ‘net’ basis. That is to say, it measures the balance of new gold investments versus what investors have sold back from existing holdings. We can’t infer from the data how many people hold gold relative to other investments. And it doesn’t tell us anything about why people may be buying less (and/or selling more).
So we ran some research to find out.
In Q2, we commissioned Toluna to run a 10-minute online survey of more than 3,000 German investors. Such a robust sample gives us a deep insight into the attitudes and motives driving investment behaviour, along with a hefty set of data to sift through. And the findings are encouraging. Spoiler alert: Germans are not falling out of love with gold.
Germany is a gold stronghold…
Gold is a widely held investment in Germany – 37% of German investors have invested in or held gold at some point. And, with 28% current ownership, it’s the third most commonly-owned investment after savings accounts (61%) and stocks/shares (46%).
Over one third of German investors have, at some point, invested in gold
% selecting each option
SQ6: Which of the following have you ever held or invested in?
Base: Total respondents, 3,010.
Source: Toluna, World Gold Council
…where investors have a clear recognition of its key investment characteristics.
When we look into why Germans are so keen to invest in gold, their reasons for doing so are well aligned with our case for gold as a strategic asset. Aside from the fact that it’s possible to buy gold in small amounts, the top motives for investing are that it protects against inflation, is easy to buy and sell, gives a better long-term return than cash held in a savings account, and helps to spread risk and diversify their portfolio. German investors are, it seems, well versed in gold’s unique investment attributes.
German investors have clear motives for buying gold
% selecting 'Strongly agree' or 'Somewhat agree'
Q8C Please indicate how much you agree or disagree with the following statements for why you invest in gold. 5-point scale: Strongly agree; Somewhat agree; Neither agree nor disagree; Somewhat disagree; Strongly disagree.
Base: Ever invested in gold, 1114, (men 717; women 394).
Source: Toluna, World Gold Council
Gold has provided a safety net for German investors in recent years
So how does this tally with the recent lull in overall levels of gold investment demand in Germany? The country’s gloomy economic landscape has punctured investor confidence: the ZEW Institute’s expectations index plunged to 3.6 in September, from 19.2 the previous month – its lowest in almost a year. And this is reflected in the data around why people in Germany have been selling gold in recent years.
Of the 1,114 respondents who have ever invested in gold, 13% said they had sold either part or all of their gold investment since the beginning of 2023. The top reason for doing so was that they 'wanted to realise gains from the higher price'. But almost a quarter said they sold gold 'to free up funds to make a big purchase' and one fifth sold because 'it was an easy way to get some spare cash'. And notably, 18% of those who have sold gold since the start of 2023 did so because they 'needed the money to supplement my income, due to the higher cost of living'.
Recent gold selling driven by a need to realise gains and access funds
% selecting each option
Q30B - What would you say are the main reasons you sold your gold investment?
Base: Sold since the start of 2023, 147 (men 98, women 49).
Source: Toluna, World Gold Council
But what does the future hold?
Importantly though, this wave of disinvestment does not spell the end of Germany’s love for gold. Most of the recent sellers held onto some of their gold: 65% of those who have sold since the start of 2023 sold only part of their investment. This could reflect the strong belief that 'Keeping cash and physical assets is the safest way to protect one's wealth' (68% selected this as a reason for why they invest in general).
German investors, on balance, say they are likely to invest in gold in the future
% selecting each option
Q11.How likely are you to invest in gold in the future? (7-point scale)
Base: Total respondents, 3010.
Source: Toluna, World Gold Council
More importantly, German gold investors tend to be loyal, repeat buyers. Very few of the 3,010 respondents said they either 'Definitely will not' (5%) or are 'Very unlikely' (7%) to invest in gold in the future. This compares with 12% who 'Definitely will invest' and 20% who are 'Very likely' to; and 25-34 year old men are the most likely to say they will definitely invest in the future. Even those who have sold gold are very open to buying again; notably, none of the 147 respondents who have sold gold since 2023 ruled out a future investment.
Potential future gold returns, geopolitical risks, diversification benefits and falling interest rates are among the top factors that play into this likelihood of making future investments in gold.
The research gives us a sneak peek into the minds of German investors and the way they feel about gold. And, while the last couple of years have been challenging for gold demand in absolute terms, the evidence suggests that the relationship has very solid foundations.
The role of gold in enabling financial inclusion
Andrew Naylor
Head of Middle East and Public Policy World Gold CouncilAndrew Naylor
Head of Middle East and Public Policy World Gold CouncilBringing more people into the financial system is a priority for policymakers across the world.
Introduction
Boosting financial inclusion, or access to formal banking services, has become a major policy objective for governments, NGOs and international organisations across the world. Financial inclusion is often defined as allowing people to access savings products, credit, insurance, and payments systems. Access to formal financial services is important as financial security is key for economic growth and development – when individuals and households are financially secure, they are more likely to invest or start businesses, further supporting economic development.
Gold plays a hugely important role in individual and household finances for many. It can bring the financial security needed to start a business, or help individuals meet unexpected costs such as healthcare expenses. Often seen as a long-term asset it can also help ensure financial freedom in retirement. But there are other benefits too, including financial system stability and expanding access to other banking products. Where consumers trust and understand gold, retail banks have an opportunity to offer gold-backed banking products to appeal to a larger range of consumers. The World Gold Council is starting a new article series to explore these issues and bring awareness to the role that gold plays in households around the world.
Financial inclusion – the status quo
In the latest World Bank Global Fidex Report, published in 2021, the average bank account penetration rate in emerging markets was 71%, while77% globally have access to a bank account. This is a significant improvement on the 51% that had access to banking services in 2011. Despite these improvements in access to financial services, financial inclusion remains a major priority. This is why the G20 launched a new financial inclusion action plan just last year. At its heart is harnessing digital technology to improve access to formal financial services. Where bricks and mortar banks sometimes struggled to expand access through a physical branch network, the digitalisation of finance has facilitated access to hard-to-reach consumers. The same is happening in the gold market – over the last decade we have seen the development of new digital gold products that allow individuals to buy, manage, and sell gold online.
Financial inclusion - building steam
Across the world there is a rapid embrace of initiatives assisting the drive for financial inclusion. Part of this is offering a range of innovative financial products. In many markets including China, Singapore, UAE, and Malaysia retail banks are offering gold investment accounts, tapping into a natural, cultural affinity for gold. Turkey is perhaps the ‘gold standard’ with a range of gold-based products now offered by retail banks including investment accounts, buy-back schemes, gold bonds, and gold cheques, amongst others.
Financial inclusion is not just about access. It is also about appeal. The range of products on offer have to interest consumers to attract them into the banking system. “We are at an interesting inflection point where digital gold will also become a part of this process. It would add an additional dimension to financial inclusion not present with the existing set of financial instruments,” said Professor Arvind Sahay, former chairperson of the India Gold Policy Centre (IGPC).
Can gold break down the barriers to financial inclusion?
Where access to bank accounts is low, gold can—and often does—fill the gap. This is particularly the case for under-served and marginalised communities, including women, rural populations and the working poor.
Barriers to financial inclusion include a lack of access brought by infrastructure challenges, and also a lack of trust in the formal banking system. The value proposition is clear: If banks offer gold products, consumers are more likely to come into the banking system, expanding financial inclusion. It could also lead to better outcomes for gold consumers – banks are regulated entities and are often better able to leverage economies of scale, so efficiencies that can be passed on to the end consumer.
This isn’t just about selling gold though. It is also about putting it to work. The potential for gold as collateral has been floated in many countries for some time. Allowing banks to accept gold deposits could potentially bring previously unbanked people into the formal economy, enabling them to accumulate savings and apply for loans and other financial services. This is a model that could be adopted in many markets, including in lower-income ASEAN countries, which is a region with significant gold consumption.
Gold in the ASEAN region
Gold has a long-established foothold in ASEAN economies. In 2023, the World Gold Council’s Gold Demand Trends research showed that over 170 tonnes of gold was consumed in the ASEAN region. “Gold is deeply cultural across ASEAN," said Professor Sahay, former chairperson of the IGPC. “People buy it as a store of value, as jewellery, and a form of transmission of wealth from one generation to the next”.
The region isn’t just a major consumer of gold. Indonesia and the Philippines are home to significant gold mining operations, Singapore is a major trading and refining centre, and the jewellery created in Thailand and Indonesia are prized around the world for their craftsmanship, forward-thinking designs, and value for money.
In Vietnam – the largest gold consumer in ASEAN – there are a number of drivers behind gold demand. Our consumer research (published in 2021) showed that 81% of Vietnamese view gold as a safeguard against political and economic uncertainty. It is seen by a similar number of respondents as bringing financial security in the long term, and a majority of those surveyed trusted it more than fiat currencies. “Gold tael bars and gold chi rings are the most preferred tools for saving as they can easily be traded for cash at more than 10,000 shops nationwide or used as collateral for capital loans from banks and other financial institutions,” said Huynh Trung Khanh, deputy chairman, Vietnam Gold Traders Association.
In other markets in the region, including Indonesia and Malaysia, gold pawning is also a huge business, facilitating access to credit for individuals and small businesses. Indonesia’s biggest pawn shop operator, PT Pegadaian, is state-owned. Indonesia is also home to several popular digital gold platforms that facilitate gold transactions in small denominations. It also launched a blockchain-based, precious metals-backed payments and savings platform outside of the banking system to increase financial inclusion in 2021. Developed by Indonesia's state-owned postal service, PT Pos, and foreign token provider, Kinesis, PosGo is the country’s first Sharia-compliant mobile platform. It allows users to trade gold and silver, as well as save, transact and manage their wealth in digital tokens without the need for bank accounts.
In many countries gold has both a financial role, and a cultural significance - and the interplay of the two drives consumer interest. “Gold jewellery products, such as 24K bangles and necklaces, are popular gifts for Vietnamese brides in the wedding season and newborn infants on their first birthdays. Gold bars and chi rings are also in great demand during the Vietnamese new year Tet festival, particularly on the God of Wealth day (tenth day of the new year)”, according to Huynh Trung Khanh, deputy chairman, Vietnam Gold Traders Association. Gold is used to celebrate major family milestones in Thailand too. “Gold is a popular choice for wedding, birthday and newborn celebrations,” says Pawan Nawawattanasub, member of the Board of Directors, Thai Gold Traders Association.
Conclusion
Gold meets both financial and cultural needs. As a long-term store of value, an asset that is easy to buy and sell, and an asset that can provide protection against risk and uncertainty, giving consumers financial security. It can directly and indirectly help achieve the public policy objective of maximising financial inclusion:
Meeting the objectives of financial inclusion
Strengthening the banking system
Gold is trusted and understood by many. In our global retail market insights research, 61% of consumers across the countries we studied trust gold more than currencies. 65% believe gold will never lose its value over the long term, and 67% view gold as being a good safeguard against inflation and currency fluctuations. By offering gold products, retail banks could expand their appeal. The banks in Turkey have long recognised this, and gold has been key to ensuring consumers remain formally banked. Gold can bring new product and commercial opportunities and can help strengthen the bank-to-consumer relationship.
In addition to the commercial opportunities gold can bring to the banking system, it can help improve it. Central banks have long recognised the importance of gold as a monetary system stabiliser. As a liquid asset that is easily traded, gold can strengthen proprietary balance sheets, further enhancing the attractiveness and appeal of the banking system.
This first blog is intended to set the scene and introduce some of the motivations for buying gold, and its role in individual and household finances. Over the coming months we will be publishing a series of in-depth articles focussing on specific countries, starting with Egypt.
China’s stimulus bazooka: what does it mean for gold demand?
Ray Jia
Head of Research (Asia Pacific, ex-India) and Deputy Head of Trade Engagement (China) World Gold CouncilSummary
China’s stimulus bazooka
China shocked the world with the announcement of its recent and most aggressive stimuli since COVID, designed to support the economy and boost household confidence. The long-awaited and stronger-than-expected package, announced by the People’s Bank of China (PBoC), ranges from various rate cuts and downpayment ratio reductions to measures that will support the equity market.1
And on top of all this, China has recently announced additional fiscal policy support, including increased special government debt issuance to help low-income households and enhance state-owned commercial bank capital, as well as support that will help local government resolve hidden debt issues.2 New measures to further revive the housing market including another loan prime rate cut were also announced most recently. 3
Equity market sentiment improved
Stocks cheered in response (Chart 1). The CSI300 Stock Index jumped by 16% when the stimuli were announced in the last week of September – its strongest weekly performance since November 2008. Meanwhile, Chinese equities attracted net inflows of 252bn yuan, the largest weekly volume on record.4 And while market volatility rose sharply following the early October National Day Holiday, trading volumes and investor sentiment towards Chinese equities generally stayed elevated.
Chart 1: Despite recent volatility, investors are generally in a cheerful mood
China’s Shenzhen and Shanghai 300 Stock Index and daily turnover*
*As of 18 October 2024.
Source: Bloomberg, World Gold Council
What does this mean for gold demand in China?
The recent measures are likely to provide support for China’s economic growth. A reduced mortgage burden along with various other measures designed to revive the property sector could boost consumer and investor confidence. This is borne out by the fact that institutions have raised their expectations for China’s GDP growth in 2024.5
The anticipated rebound in economic growth will likely boost China’s gold demand. And as the largest components of that demand, we believe gold jewellery and bar and coin will be impacted the most (Chart 2).
Chart 2: Gold jewellery and bullion investment drive Chinese retail gold demand
Gold demand composition in 2023 and the 10-year average*
*10-year average based on the average between 2014 and 2023. Note that gold jewellery demand figures are net of recycling, assuming all recycling supply comes from the jewellery sector.
Source: Metals Focus, World Gold Council
We have noted in previous reports that China’s gold demand has been under pressure. In fact, gold withdrawals from the Shanghai Gold Exchange (SGE) – a proxy of China’s wholesale demand – have remained well below their long-term average (Chart 3). While the surging gold price has helped sustain some investment buying, it has hampered gold jewellery consumption. And the pessimistic outlook for China’s economy has also limited household spending on gold.
Chart 3: 2024 Chinese gold demand is below its long-term average
Monthly gold withdrawals from the SGE and the 10-year average
Source: Shanghai Gold Exchange, World Gold Council
But the aggressive stimuli should provide tailwinds. Our analysis shows that economic growth is the fundamental driver of Chinese gold demand (Chart 4). More specifically, every one percentage point increase in China’s annual GDP growth leads to a 5.2% rise in gold jewellery consumption and a similar 5.1% increase in bar and coin buying, holding all else constant.
Chart 4: In general, good economic news = good gold consumption news
Annual GDP growth and annual growth in gold jewellery demand (left) & bar and coin investment (right)*
*Based on annual Chinese gold jewellery demand, bar and coin investment and GDP between 2000 and 2023.
Source: Metals Focus, Bloomberg, Shanghai Gold Exchange, World Gold Council
But there are other considerations. The level of the local gold price and the number of weddings are other main factors that impact gold jewellery consumption. Also, our analysis shows that, other than GDP, every 1% increase in the value of local equities reduces gold investment demand by 0.4% as enhanced investor risk appetite tends to limit safe-haven demand for gold (Chart 5). Finally, while limited historical data limits our ability to quantify the effect for gold ETFs, we anticipate investment in this sector may also face competition from equities and other risk assets – and the gold price will continue to be a key factor impacting gold ETF flows in China.
Chart 5: Usually, strong equity performance distracts investors from bar and coin investment
Annual stock returns and bar and coin demand change*
*Based on annual changes in bar and coin as well as Shanghai Composite Stock Index between 2000 and 2023.
Source: Wind, Metals Focus, World Gold Council
Summary
Although it may take some time for the economy to fully digest the positive impact of the current and potential future stimuli, we believe improved consumer confidence and GDP growth should bode well for China’s gold demand in general.
That said, other factors such as the gold price, the number of weddings, changes in young consumers’ tastes, as well as the industry’s consolidation – as mentioned in our recently published 2024 Chinese Gold Jewellery Retail Insights – are also vital drivers of local gold jewellery demand.
Furthermore, as investors perceive a brighter economic future and competing assets, such as property, come into focus, the needle for bar and coin investment is also likely to shift.
Gold has been a fascinating accessory, a proven store of value and long treated as the symbol of good luck to China. And we believe its relevance in Chinese consumers’ daily lives as well as in local investors’ portfolios will continue to shine. We will keep a close eye on future developments and provide more detailed analysis as needed.
Footnotes
1. For more, see: China's central bank unveils sweeping measures to boost economy - CGTN and China unveils fresh stimulus to boost high-quality economic development (www.gov.cn)
2. For more, see: China to launch more fiscal stimulus measures, says finance ministry - CGTN and China economy: Beijing will ‘significantly’ increase spending | CNN Business
3. For more, see: China unveils new measures to stabilize housing market (www.gov.cn) and China cuts benchmark lending rates by 25 basis points
4. Based on Wind’s statistics. This data goes back to January 2010 on a daily basis.
5. For more, see: Goldman Sachs raises China's economic growth forecast - CGTN
Let's Tally the Rally
Johan Palmberg
Senior Quantitative Analyst World Gold CouncilNo let up in October
Gold made further gains in October, smashing through previous record highs to finish up 4.0% at US$2,734/oz (Table 1).
The rally occurred amid unusual mutual gains in the US dollar, bond yields and equities. This was reflected in the large residual shown in our Gold Return Attribution Model (GRAM) – see Chart 1. According to GRAM, yield- and FX-related opportunity cost factors were a drag on the price alongside momentum, with only risk and uncertainty – and the ever present economic expansion – contributing positively to its return, via a combination of higher breakeven inflation and geopolitical risk.
Chart 5 shows that much of gold’s price action took place during late Asian/early European trading hours. This at least partly explains the increasingly frequent disconnect between gold’s return and its usually reliable – yet US-centric – short-term drivers of rates and the US dollar. A risk premium ahead of US elections is also a likely driver. Global gold ETFs experienced further inflows in October led by the US and China, but North American inflows (30t as of 31 October) were more than offset by COMEX futures positions, which pared 40t over the month, lending credence to the idea that October was mostly an Asia story.
Table 1: No let up for gold’s strong run in October, reflected in major currencies as the US dollar also gained
Performance of gold in various currencies*
*Data to 31 October 2024. Based on the LBMA Gold Price PM in USD, expressed in local currencies.
Source: Bloomberg, ICE Benchmark Administration, World Gold Council
Chart 1: Gold bucked strength in the US dollar and Treasury yields, as geopolitical and high Asian hours activity drove returns in October
Multifactor model detailing attribution of gold’s drivers on its monthly returns*
*Data to 31 October 2024. Our Gold Return Attribution Model (GRAM) is a multiple regression model of gold price returns, grouped into four thematic driver categories of gold’s performance: economic expansion, risk & uncertainty, opportunity cost, and momentum. These themes capture motives behind gold demand; most importantly, investment demand, which is considered the marginal driver of returns in the short run. ‘Residual’ captures the share of gold returns that is not explained by factors already included. Results shown here are based on analysis covering an estimation period from October 2019 to October 2024. We have reduced the estimated window to five years to better reflect current conditions.
Source: Bloomberg, World Gold Council
Gold and the US election
US elections take place this week and could spark some volatility across markets. There is probably little to be gained in having conviction in asset trajectories during such a polarised and binary event, so we suspect that many investors quite like the safety of gold and other hedges in such circumstances.
Our recent analysis found no discernible pattern in gold’s near-term reactions to past elections. It was only when the dust settled and policy shifts – both fiscal and monetary – became clear, that gold took its cues. We remain of the opinion that the fiscal plans proposed under both administrations will continue to attract investors to gold.
Let’s tally the rally
As we are delaying our Gold Market Commentary until after the election, we wanted to provide an early look back at gold’s phenomenal run in 2024 – by the numbers.
Top performer
Gold has had a stellar year as one of the best performing assets in 2024, made all the more remarkable given a positive performance by risk assets, a stronger US dollar and elevated bond yields (Chart 2). The price was boosted by:
Chart 2: Gold has been one of the best performing assets in 2024
Y-t-d performance of various assets, in US$
*Data from 1 January 2024 to 31 October 2024
Source: Bloomberg, World Gold Council
Higher highs
Gold has posted 39 new all-time highs in US dollars this year, second only to 1979 (57) and closely followed by 1972 (38) and 2011 (38) (Chart 3). March, September and October saw the largest number of new highs (8). These may be throwaway statistics to some but they often matter in driving media coverage and sentiment: who doesn’t like reading about records being broken? But, there are some noteworthy differences. For one, previous record-setting years have been accompanied by strong investment demand. Gold ETF inflows in Western markets are very late to the party this year, and retail investment demand has not picked up much either. Furthermore, media fervour is not as visible today as it was during 2020 when gold made its first new all-time-highs for nigh-on a decade, suggesting perhaps that this time, sentiment has not gotten carried away (Chart 4).
Chart 3: Gold has made 39 new highs, the second highest annual tally on record
Gold price and new all-time-high closes*
*Data from 31 December 1971 to 31 October 2024.
Source: Bloomberg, World Gold Council
Chart 4: Repeated new highs have failed to excite media as much as during the 2020 run-up
News, social media and Bloomberg word search for “gold”
Source: Bloomberg
Time is of the essence
The largest contributions to returns during October were recorded during Asian trading hours (Chart 5). Yet most of gold’s volatility occurred during European and US sessions (Chart 6), consistent with the narrative of emerging market investors and central bank buying helping to drive prices higher even as trading in Western markets, as it tends to do, creates the most short-term noise.
Chart 5: Gold’s return has been driven mostly during Asian trading hours in 2024 – and notably in October
20-minute intraday spot gold mid-price cumulative returns divided into regional trading sessions*
*Data from 1 January 2024 to 31 October 2024. Gold spot mid-price at 20-minute intervals. Sessions: Asia 2200 to 1100 UTC, Europe: 1100 to 1400 UTC, US: 1400 to 2200. Asia session runs from 22:00 UTC to 1100 UTC, overlapping with normal European trading hours, given that much of larger Asia gold trade is likely to take place at the LBMA AM benchmark price at 1100 UTC. Asian trading hours remain the largest contributor, albeit to a lesser extent if we end the session at 0700 UTC.
Source: Factset, World Gold Council
Chart 6: Returns have been dominated by the East, volatility by the West
20-minute intraday spot gold mid-price annualised return volatility divided into regional trading sessions*
*Data from 1 January 2024 to 31 October 2024. Volatility is calculated as the annualised volatility of 20-min log returns per session. Sessions: Asia 2200 to 1100 UTC, Europe: 1100 to 1400 UTC, US: 1400 to 2200. Asia session runs from 22:00 UTC to 1100 UTC, overlapping with normal European trading hours, given that much of larger Asia gold trade is likely to take place at the LBMA AM benchmark price at 1100 UTC. Asian trading hours remain the largest contributor, albeit to a lesser extent if we end the session at 0700 UTC.
Source: Factset, World Gold Council
The big little rally
If we look back before 2024 to where the current rally began, while impressive, it ranks quite poorly compared to historical bull runs – having been both lower in magnitude and duration than all except the rally of 1983 (Chart 7). This stands to reason given the reluctance of many Western investors to join the fray; some perhaps having misjudged the reasons for the rally and others fearing they have missed it altogether.
Chart 7: The rally is impressive but ranks low compared to previous run-ups
Gold price and bull market rallies since 1971*
*Data from 31 December 1971 to 31 October 2024. Bull market start and end points defined using SciPy ‘argrelextrema’ package on a smoothed price series with conditions of minim run duration of 26 weeks and return of 20%, followed by a minimum 20% pullback prior to next local minimum.
Source: Source: Bloomberg, World Gold Council
In summary
It has been a strong run for gold in 2024, dominated by Asian hours trading. Central banks, emerging market bar and coin as well as other investors have been instrumental in driving up prices even in the face of strong US Treasury yields, a firm US dollar and hitherto reluctant Western investors. But it’s worth noting that:
Unearthed: Gold responds to the Fed's rate cut, US election and China stimulus
Unearthed Podcast
World Gold CouncilIn this episode of Unearthed, hosts John Reade and Joe Cavatoni discuss the latest gold market trends, reflecting on the U.S. election outcome, monetary policy, and China’s recent economic developments. They highlight record-breaking gold demand, central bank buying, and shifting global economic dynamics influencing gold prices (more via Gold Demand Trends Q3 2024).
They explore how geopolitical uncertainties, inflation concerns, and market corrections are shaping investment strategies worldwide. With gold’s role in China's investment market and Western investors returning to risk assets, this episode unpacks the critical factors driving gold’s future.
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You asked, we answered: How important is AI for gold demand?
Louise Street
Senior Markets Analyst World Gold CouncilTrevor Keel
Consultant World Gold CouncilDemand for gold used in electronics peaked in 2010 at 328t, steadily falling to 249t in 2023. In recent quarters, however, this sector has seen a modest recovery. And we’ve received a raft of questions around how much of that recovery can be explained by the growth of Artificial Intelligence, whether it will continue to drive growth in the sector and why exactly AI is an important emerging area of demand for gold.
Gold in electronics: a recent history
Gold plays a crucial role in electronic devices: it is an excellent conductor of electricity; it does not corrode; and its physical and chemical properties allow it to be manipulated into extraordinarily thin wires and reliable coatings. These properties make it an indispensable component of the computer chips found in almost all electronic equipment.
The surging price of gold between 2001 and 2011 (from ~US$250/oz to over US$1,800/oz) encouraged manufacturers in the electronics industry to look for ways to reduce their gold usage. These strategies involved both substitution (replacing gold with alternatives such as silver and copper) and thrifting (using smaller and smaller quantities of gold).1
Chart 1: Manufacturers reduced gold usage in response to the price rise
Gold used in electronics, in tonnes, and the annual average gold price, in US$/oz*
*Data as at 30 September 2024.
Source: ICE Benchmark Administration, Metals Focus, Refinitiv GFMS, World Gold Council
But retooling and process development does not happen overnight in electronics fabrication facilities; indeed, it is a multi-year process. And this shift coincided with consumer demand for ever more powerful, functional and reliable devices powered by advanced electronics and increasingly complex chips – think the proliferation of now-ubiquitous smartphones and the vast growth in laptops, smart TVs, electric vehicles…the list goes on. Manufacturers had to balance cost reduction with gold’s indispensable role as they addressed the growing need for high-end, durable components during this unprecedented period of “electrification”.
The role of gold in AI
AI is fast becoming a cornerstone of modern technology, driving advancements across various industries. The considerable electronics infrastructure required to power this rapidly growing sector has a direct impact on industrial gold demand.
As outlined above, gold is an essential component in the manufacturing of AI-enabled devices. AI systems rely heavily on advanced hardware, including processors, memory chips and sensors, all of which utilise gold. AI-enabled devices, such as smartphones and autonomous vehicles, alongside a corresponding growth in data centres, has created an exponential rise in the need for highly efficient and reliable electronic components. Gold's superior conductivity ensures that data can be processed and transmitted at high speed with minimal energy loss. Furthermore, gold's resistance to corrosion ensures component longevity and durability – critical for continuous and intensive AI applications.
As AI technology advances, the demand for more sophisticated and powerful hardware can only increase. This, in turn, is likely to drive demand for gold, as manufacturers seek to enhance the performance and reliability of their AI-enabled devices. Meanwhile, sectors such as healthcare and finance are looking to AI in order to improve efficiency and innovation, and this can only further amplify demand.
Chart 2: AI-proliferation has aided the recent recovery in gold usage
Gold used in technology applications, in tonnes, and the quarterly average gold price, in US$/oz*
*Data as at 30 September 2024
Source: ICE Benchmark Administration, Metals Focus, World Gold Council
But once again manufacturers face the challenge that catalysed the earlier wave of gold substitution and thrifting: cost. With gold recently reaching all-time highs of over US$2,700/oz, manufacturers are bound to face renewed pressure to evaluate how they use gold. But the situation today is very different to that of 2010 in that most of the “easy” thrifting and substitution has already been implemented; there is a limit to how thin wires and coatings can be and it is highly likely that they are already close to – if not at – that point. Additionally, as technologies evolve, some of gold’s traditional uses may slowly wane; one example is the ongoing changes in the LED sector where gold-free mini-LEDs are slowly usurping the gold-containing incumbents.
So what does this mean for the future of gold demand in the technology sector?
Gold's role beyond AI
While the electronics industry still dominates demand for gold in the technology sector, it is far from the only application that relies on this precious metal. Gold's versatility and unique properties make it indispensable in various other areas of technology:
In conclusion, gold will continue to be a critical component in the electronics industry, with AI applications bolstering its demand in the near term. But in this cost-driven sector manufacturers will continue to innovate and this will inevitably impact how gold is used in certain applications. Beyond electronics, gold’s unique properties make it a valuable resource across multiple areas, ensuring its continued relevance in the ever-evolving technology landscape.
1Substitution occurred almost entirely at the lower end of the market, especially where safety or device longevity was less of a consideration (neither silver nor copper are corrosion resistant, making failure more likely). Thrifting was more widespread across the industry, facilitated by thinner gold wires and coatings, and by a more careful management of gold usage during the manufacturing process.
Gold’s 2024 performance best in 14 years
Taylor Burnette
Research Lead, Americas World Gold CouncilGold performed exceptionally well in 2024, outperforming all major asset classes and proving to be a strong portfolio diversifier. Over the course of the year the LBMA Gold Price PM set 40 new all-time highs (ATH), the most recent of which was US$2,777.80/oz on 30 October.
Gold rose 25.5% in 2024, likely due to its role as an effective hedge against the heightened geopolitical uncertainty and market volatility experienced this year.
According to our Gold Return Attribution Model, gold’s positive performance was linked to the following key factors:
Market consensus expectations suggest a more modest performance for gold in 2025, but with the potential for upside catalysts as the year unfolds. As you prepare for the year ahead, take a look at our 2025 Outlook where we outline potential scenarios and their impact on gold.
Chart 1: Gold outperformed all major asset classes in 2024
*Data as of 31 December 2024. Indices used Bloomberg Barclays Global Treasury ex US, Bloomberg Barclays US Bond Aggregate, ICE BofA US 3-Month Treasury Bills, New Frontier Global Institutional Portfolio Index, MSCI World ex US Total Return Index, Bloomberg Commodity Total Return Index, MSCI EM Total Return Index, LBMA Gold Price PM (USD/oz), MSCI US Total Return Index.
Source: Bloomberg, ICE Benchmark Administration, World Gold Council