Gold plays a prominent role in reserve asset management, being one of the few assets that is universally permitted by the investment guidelines of the world’s central banks. This is in part due to the gold market being deep and liquid – a key requirement of reserve asset managers.
Gold demand fell 1% in 2019 as a huge rise in investment flows into ETFs and similar products was matched by the price-driven slump in consumer demand.
Surge in ETF inflows supports Q3 gold demand growth. Gold demand grew modestly to 1,107.9t in Q3 thanks to the largest ETF inflows since Q1 2016
Gold demand was 1,123t in Q2, up 8% y-o-y. H1 demand jumped to a three-year high of 2,181.7t, largely due to record-breaking central bank purchases.
Gold demand lifted by central banks and ETFs. This compares with a relatively weak Q1 2018, when demand sank to a three-year low of just 984.2t. Central bank buying continued apace: global gold reserves grew by 145.5t.
Gold demand in 2018 reached 4,345.1t, up from 4,159.9t in 2017. This was exactly in line with five-year average demand of 4,347.5t.
Gold demand was 964.3t in Q3, just 6.2t higher y-o-y. Robust central bank buying and a 13% rise in consumer demand offset large ETF outflows.
Gold demand stayed soft in Q2, dropping to 964.3t. The H1 total of 1,959.9t is the lowest since 2009.
Gold demand of 973.5t was the lowest Q1 since 2008. The main cause was a fall in investment demand for gold bars and gold-backed ETFs, partly due to range-bound gold prices.