World Gold Council: Gold demand firmly above longer term average

The demand for gold has shown remarkable strength in the third quarter of the year, with significant contributions coming from jewellery, investments, and central bank purchases. According to John Reade, Chief Market Strategist at the World Gold Council, jewellery demand in India and China reached new highs, reflecting an overall growth of 10% year-on-year. Central banks have been the primary driving force behind the surge in gold buying, setting a record pace in the first three quarters of the year. The robust purchasing trend from central banks observed this year may even exceed the record levels witnessed in the previous year. The focus on central bank reserves, inflation concerns, geopolitical risks, and the shift towards a multi-polar currency world are key factors fueling this surge in central bank gold acquisitions. Regarding jewellery demand, the strength of the Indian market despite high gold prices is a positive sign for the sector's future. Gold, currently trading close to $2,000 an ounce, remains a cornerstone of Indian purchases, due to the country's demographic potential and cultural significance. Looking ahead, the short-term price of gold may be influenced by geopolitical events, while the longer-term outlook hinges on central bank monetary policies. As interest rates stabilize and potentially decrease in the future, gold is expected to perform well, especially during periods of economic uncertainty or a weakened US dollar. Overall, the foreseeable future for gold appears to be choppy, driven by ongoing geopolitical tensions, but with a promising outlook once interest rates start to decline worldwide. With the gold market displaying resilience and strong demand across various sectors, including central bank acquisitions, jewellery consumption, and evolving investment trends, the precious metal continues to assert its enduring appeal and value in the global economy.