And strong investment demand
The World Gold Council’s Gold Demand Trends report for Q4 and the full year 2024 highlights an exceptional surge in global gold demand, marking a new all-time high of 4,974 tonnes. The increase was primarily driven by robust and sustained central bank purchasing activity, alongside strong growth in investment demand.
Record-high gold prices and large volumes of gold transacted resulted in the highest-ever total value of demand, reaching $382 billion.
Central banks continued their aggressive gold purchasing strategy in 2024, with their total gold purchases surpassing 1,000 tonnes for the third consecutive year. Central bank buying activity spiked significantly in Q4, reaching 333 tonnes, pushing the annual total to a record-breaking 1,045 tonnes.
This ongoing trend of central banks accumulating gold underscores the growing desire for the precious metal as a reserve asset amid economic uncertainties.
Global investment demand for gold significantly increased in 2024, rising 25% year-on-year to 1,180 tonnes. This marked a four-year high, bolstered by a resurgence in gold exchange-traded fund (ETF) demand in the latter half of the year.
Gold-backed ETFs added 19 tonnes in Q4 2024, contributing to two consecutive quarters of inflows for the asset class. While bar and coin demand remained steady at 1,186 tonnes in 2024, year-on-year demand primarily held consistent with 2023 levels, reflecting the ongoing popularity of physical gold investments among global investors.
Drop in jewellery sector
Despite the strong overall demand for gold, the jewellery sector saw a decline in consumption in 2024, falling by 11% to 1,877 tonnes. This decrease was primarily driven by a significant drop in demand from China, which saw a 24% year-on-year decline.
However, demand in India remained relatively resilient, with only a modest 2% decline in 2024 despite the challenging high-price environment. The dip in jewellery demand is attributed to the pressure of record-high gold prices on consumer spending.
In contrast to the jewellery sector, the technology sector experienced a notable rise in demand for gold in 2024. The industry saw its strongest quarter since Q4 2021, with demand reaching 84 tonnes in Q4 alone.
A 7% year-on-year increase in gold used for electronics and artificial intelligence (AI) applications contributed to the overall rise, bringing total gold consumption in technology to 326 tonnes in 2024. Global gold supply also slightly increased in 2024, rising by 1% year-on-year to a new record of 4,794 tonnes.
This increase was driven by higher mine production and growth in gold recycling, reflecting the continued strength in global gold markets.
Louise Street, Senior Markets Analyst at the World Gold Council, noted: “Gold once again dominated headlines in 2024, with prices hitting 40 record highs throughout the year. The demand trajectory was not linear, as central banks exhibited strong buying in Q1, followed by a dip in mid-year before an impressive Q4 rebound. Investment demand, especially from Western investors and Asia, led to positive ETF flows in the latter half of the year.”
About 2025, Street anticipates that central banks will continue to be the main drivers of gold demand, with gold ETFs expected to follow suit, particularly if interest rates remain volatile. Jewellery demand may continue to struggle under high gold prices, while geopolitical and macroeconomic uncertainties are expected to keep gold in demand as a safe haven and hedge against risks.
Image: Global investment demand for gold significantly increased in 2024, rising 25% year-on-year to 1,180 tonnes. Credit: Zlaťáky.cz
