According to World Gold Council’s Gold Demand Trends, the worldwide demand for the yellow metal reached an all time high in value terms to US$236.4 billion. In volume-terms, demand dropped 4 percent over 2011, to 4,405.5 tonnes. The average price of gold in the year stood at $1,669 per ounce, rising 6 percent from 2011.
The value of gold demand in the fourth quarter was the highest fourth quarter total ever, worth a near-record US$66.2 billion.
The global demand for gold jewellery in the said year increased 4 percent in value terms to $102.6 billion, but decreased 3 percent in volume terms. In the U.S., jewelry demand slipped 2 percent to $5.8 billion, and in Europe it dropped 7 percent to $2.4 billion. In India, the largest gold consumer, demand for gold jewellery in value terms dropped 3 percent to $29.7 billion. Greater China’s demand for gold jewellery in value terms rose 6 percent to $29.3 billion. Overall, India’s gold demand in volume terms decreased 12 percent, but there was an increase in demand in gold jewellery in the fourth quarter partly due to surge in jewelry demand, up 35 percent and the highest level in six quarters. In China the volume of gold demand remained flat in 2012 and the volume of gold jewellery demand inacresed slightly by 1 percent in the fourth quarter.
Marcus Grubb, Managing Director, Investment at the World Gold Council said: “China and India remain the world’s gold power houses, and by some distance, despite challenging domestic economic conditions. In India, consumer sentiment towards gold remained strong despite measures aimed at curbing demand, reaffirming gold’s role in Indian society. In an underdeveloped financial system in India, gold has an important role to play. Notwithstanding the predicted economic slowdown in China, investment demand was up 24 percent in Q4 on the previous quarter and jewellery consumption held steady at 137.0t. Central banks’ move from net sellers of gold, to net buyers that we have seen in recent years, has continued apace. The official sector purchases across the world are now at their highest level for almost half a century.” Global investment in exchange-traded-funds (ETFs) rose 51 percent in 2012.