.jpg "Global gold demand slows in the second quarter")
Global gold demand slows in the second quarter
Lower purchases by central banks and investors pushed global demand for the yellow metal down 2% in the second quarter. Over the first half of the year, the decline was 6%, according to the World Gold Council.
Turkey's massive sales in the second quarter in an exceptional context weighed on demand for the yellow metal. China's reopening helped offset India's declining gold consumption.
After a record year 2022, global demand for the yellow metal weakened in the second quarter, suffering from a decline in purchases by the Turkish central bank and a disenchantment of professional investors, despite its status as a safe haven that is worth it to be sought after in times of crisis. Gold demand between April and June stood at 920.7 tonnes, down 2 percent year-on-year, according to the World Gold Council's (WOC) quarterly report released on Tuesday. For the first half of 2023, gold demand fell by about 6% compared to 2022, reaching 2,062 tonnes.
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The scale of Turkey's central bank's sales
"Central bank demand for gold slowed significantly in the second quarter," the CMO said. While many of them continued to buy, "the scale of Turkey's sales had a significant impact on global demand, dwarfing the purchases of its counterparts," Krishan Gopaul, an analyst at the organization, told AFP. Global gold purchases by central banks totaled 102.9 tonnes between April and June 2023, a drop of 35% compared to the same period in 2022.
Professional investors also slightly divested themselves of ETFs and price-indexed financials in the second quarter. of physical gold and allowing to bet on its price. ETFs recorded capital outflows equivalent to 21.3 tonnes of gold from April to June 2023.
In the second quarter, the price of gold fell slightly, with rate hikes by the US Federal Reserve (Fed), in particular, benefiting both the dollar and the yield on US government bonds, weighing on the attractiveness of the precious metal.
Demand in the technology sector – the yellow metal found in the components of many electronic devices such as computers or mobile phones – also faltered in the second quarter (-10%) to 70.4 tonnes.
Investment in physical gold on the rise
Physical investment in coins and bars rose slightly (+6%), totalling 277.5 tonnes.
And in the jewelry sector, gold demand rose 3 percent year-on-year to 475.9 tonnes, driven by Chinese demand, up 28 percent from the second quarter of 2022.
This jump in China is largely due to a comparison effect compared to the second quarter of 2022, marked by particularly weak demand while health restrictions to fight Covid-19 were still in force.
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