Global gold demand rises 1 percent in third quarter

By Jeyhun Aliyev

ANKARA

The global demand for gold rose 1 percent in the third quarter of 2018, the World Gold Council said Thursday.

The council report revealed that the global gold demand increased 6.2 tons over the same period last year to reach 964.3 tons.

"Bar and coin demand jumped 28 percent to 298.1 tons as retail investors took advantage of the lower gold price and sought protection against currency weakness and tumbling stock markets," the report said.

China -- world’s biggest bar and coin market -- registered 25 percent demand increase year-on-year.

Global demand was also boosted in many emerging markets due to stock market volatility and currency weakness.

The report showed that the sharp outflows in gold-backed Exchange-Traded Funds (ETFs) offset growth across much of the gold market, while ETFs shed some 103.2 tons in the third quarter of this year.

"ETFs saw a 116 tons decline when compared with inflows of 13.2 tons in Q3 2017, experiencing the first quarter of outflows since Q4 2016," it added.

The global jewelry demand climbed 6 percent year-on-year, reaching 535.7 tons, while the demand rise in India and China outweighed weakness in the Middle East.

The demand for gold in technology increased 1 percent compared to the same period last year, reaching 85.3 tons, registering the eighth consecutive quarter of growth.

Gold demand in Turkey

The report showed that the global central bank net purchases totaled 148.4 tons in Q3, rising 22 percent year-on-year.

Turkey, for its part, continued to add gold to its reserves despite the economic fluctuations in the market.

"[Central Bank] net purchases (excluding Reserve Option Mechanism holdings) grew by 18.5 tons in Q3, a quarter that saw the lira weaken by 25 percent," the report revealed.

The jewelry buyers in Turkey shied away from spending decisions due to high price volatility during that timeframe.

"A rising and volatile gold price during Q3 saw demand in Turkey slump 31 percent year-on-year," it said.

During the third quarter, rather than fresh jewelry and investment purchases, Turkey preferred the further increase of 30 percent in gold recycling as local gold prices soared, the report revealed.