Contact us
CALL US NOW 1-888-GOLD-160
(1-888-465-3160)

Global Demand for Physical Gold Up in First Quarter

  by    0   0

Global demand for physical gold increased by 9% year-on-year in the first quarter of 2017, according to the latest demand report from the World Gold Council.

The sale of gold bars and gold coins hit 289.8 tons worldwide in Q1, driven by Asia’s appetite for gold. The WGC said the strength of the retail investment market in the first quarter built on 2016’s exceptionally strong finish.

Demand in China soared in the first quarter. Chinese investors gobbled up 105.9 tons of gold. That represents a 30% year-on-year increase, and was the fourth strongest quarter on record.

Demand also rebounded in India after a weak end to 2016. Indians bought 31.2 tons of gold bars and coins in the first quarter of this year. This after the Indian economy virtually ground to a halt after after a government demonetization policy that suddenly declared 1,000 and 500 rupee notes no longer valid. According to the WGC, currency in circulation fell 50% from Nov. 11 to Jan. 6. Sales of motorcycles – a good barometer of the health of India’s cash-reliant economy – halved in December. Gold imports in the first quarter indicate a rebound, increasing 106% over Q1 2016.  It appears strong first quarter demand carried over into the new quarter. Indians bought 23 tons of gold in a single day during the Akshay Tritiya festival last week.

Demand for gold bars and coins was also strong in Europe during the first quarter. Europeans bought 60.8 tons of gold, up 9% year-on-year. The German market led the way in Europe. Demand increased 13% y-o-y rising to 34.3 tons. It was the strongest first quarter for physical gold sales in Germany since 2011.

Switzerland and Austria saw decent growth, as did the UK, which hit its highest level since Q2 2013. As with European-based institutional investors, the specter of political uncertainty prompted retail investors to buy gold as a hedge against the flurry of elections in the Netherlands, France and Germany.”

The only major market to see a decrease in demand for physical gold in Q1 was the US. Bar and coin sales slipped 20% year-on-year to 16.2 tons. WGC analysts say American investors shifted their focus away from gold to buy into the Trump-rally and chase equity markets higher. Americans may be playing a risky game. As we reported recently, there exists a big disconnect between stock market perception and economic reality. Many Americans are also starting to realize that Trump may not be as adept at getting things done politically as they’d hoped.

Inflows of gold into ETFs also increased, although it was dwarfed by the first quarter of last year. Global holdings of gold-backed ETFs grew by 109.1 tons in Q1; total AUM in these products stood at 2,251.8 tons by quarter-end, worth just over $90 billion.

The main headline generated out of the WGC Q1 report was that gold demand was down overall. But this was really more a function of an exceptional first quarter in 2016. The real story is that investors around the world are buying physical gold.

Get Peter Schiff’s latest gold market analysis click here for a free subscription to his exclusive monthly Gold Videocast.
Interested in learning how to buy gold and buy silver?
Call 1-888-GOLD-160 and speak with a Precious Metals Specialist today!


Related Posts

Romania a Step Closer to Repatriating Its Gold Reserves

gold barsRomania moved another step closer to bringing all of its gold home this week. According to Romanian news outlets, the Chamber of Deputies Budget and Finance Committee released a favorable report on legislation that would require the country’s central bank to repatriate its gold and hold it within the borders of the country. Related

READ MORE →

China’s Keynesian Experiment

While President Trump nags the Federal Reserve to reinstitute Obama-era monetary stimulus, China has already taken off down that path. And it actually has some people in the mainstream concerned. According to a Reuters report, the Organisation for Economic Cooperation and Development (OECD) is warning that while Chinese government stimulus may boost the country’s economy […]

READ MORE →

European ETF Gold Holdings Hit Record Level

The amount of gold held by Europe-based ETFs hit a record high in the first quarter of 2019, according to a report by the World Gold Council. European funds now hold 1,121.4 tons of gold. The WGC pinpoints three primary drivers of European gold investment. Related

READ MORE →

Production Plunges for World’s Largest Silver Miner in Q1

The world’s largest primary silver producer reported a plunge in production in the first quarter of the year, continuing a global trend of declining silver output. Total silver production at Fresnillo PLC dropped by 15% in Q1. The company blamed falling mine output on lower ore grades and reduced volume of processed ore. Related

READ MORE →

Silver Demand Hit 3-Year High in 2018 as Supply Fell

Silver demand was up 4% and hit a three-year high in 2018, according to the 2019 World Silver Survey released by the Silver Institute this week. Physical demand for silver came in at over 1 billion ounces last year. Meanwhile, silver mine production fell for the third straight year, dropping 2% in 2018 to 855.7 […]

READ MORE →

Comments are closed.

Call Now