A World Gold Council report released Thursday showed increased demand for the precious metal during the second quarter, supported by investment demand despite central banks reducing their purchases.
Global gold demand—including over-the-counter (OTC) trading—rose 3% year-on-year to 1,248.8 metric tons in the second quarter of this year, with investment demand increasing 78%.
The report indicated that central banks purchased 166.5 tons during the second quarter, about a third less than in the first three months of the year, bringing purchases in the first half of the year to their lowest levels since 2022.
Global gold jewelry consumption fell 14% to 341.0 tons, the lowest level since the third quarter of 2020.
John Reed, a strategist at the World Gold Council, said: "If you're aiming to allocate a percentage of your foreign exchange reserves to gold, when prices rise significantly, it reduces the incentive to buy." He explained that rapid price gains have led to a decline in demand for fear of further price declines, according to Bloomberg
