Gold demand posts weakest start to the year since 2008 - WGC
Gold demand posted its weakest start to the year in a decade, the World Gold Council said on Thursday, as prices of the metal stagnated and the threat of rising interest rates led investors to seek better returns elsewhere.
Global gold demand totalled 973.5 tonnes in the January to March period, down 7 percent year on year and the weakest first quarter since 2008. That coincided with a period of calm in the gold market, which saw prices hold within their narrowest range of any quarter in more than a decade.
"The rangebound gold price has certainly had an effect on investor sentiment," the WGC's head of market intelligence Alistair Hewitt said.
"It works both ways - for people in the retail space, a price drop can be an entry point, and if the price is rising, people want to take advantage of that momentum."
The biggest drop in demand came from the investment sector, with bar and coin consumption down by 15 percent and buying of gold-backed exchange-traded funds two-thirds lower year on year.
Jewellery consumption was also soft, edging down 1 percent. Buying in India, the second biggest gold jewellery consumer after China, posted its third weakest quarter in a decade, falling 12 percent year on year to just under 88 tonnes.