Where has this year gone I hear you say! Don’t worry you are not the only one wondering how fast the last 11 months have flown by.
As the World Gold Council (WGC) release their latest report on the global gold demand we recap on the main points made.
In summary global demand for gold fell by 2% year on year (YOY) to 929 tonnes. This was reflected in a 4% decline in jewellery sales YOY. Gold bars and coins have also fallen by 21% to 246tonnes, however this can easily be seen as a re adjustment towards more sustainable levels from the unprecedented demand surge last year.
Marcus Grubb MD of investment strategy said “this quarter the market continued to find its feet after an exceptional 2013.” “The long term sources of demand – jewellery, investment, central banks and technology remain robust and diverse.”
Therefore overall we can ascertain that Q3 was a quiet trading period for gold with not too much going on. This is likely to be largely due to the strength of the US dollar, as well as a marked lack of a clear price signal which lead to investors holding back for a potential bottom out.
However the highlight amongst the calm was the Indian jewellery demand in the run up to the Diwali festival, which showed a spike in gold imports as the festival season neared with the buying commencing in September.
In summary, the demand for gold in Q3 had showed a slowdown, however we agree with the World Gold Council that this merely reflects “an adjustment towards more normal levels of demand after a surge of unprecedented consumer demand last year.”