The World Gold Council (WGC) released its Gold Demand Trends report for the first quarter of 2015. The WGC considers 2014 a year of stabilization for the gold market, and the the first quarter of the year saw this trend continue. The supply-demand picture for gold remained relatively unchanged. However, looking to the rest of 2015, the WGC sees supply subsiding. At the same time, demand could rise as investors adjust their strategies in response to weak economic growth in the West. In fact, the first three months of 2015 already saw a noticeable increase in gold investment demand:
ETFs (+26 tonnes) benefited from improved Western investor attitudes towards gold; Q1 2015 was the first quarter of positive net purchases since Q4 2012. Bar and coin demand, 10% weaker year-on-year, remains elevated compared with historical levels.
In this video interview, WGC’s Head of Market Intelligence Alistair Hewitt summarizes the report’s findings.
Highlights from the video:
“The first three months have been very stable. We’ve seen demands at 1,079 tons – just 11 tons down on the same period last year. That’s just a dip of 1%. If we have a look at some countries, we see in India we’ve seen demand increase by 15% year-on-year. That’s largely a function of the very low demand we saw in Q1 2014. If you recall, this time last year, we had the import restrictions in place, and we had the election looming. If we turn towards China, demand there is down by 7% at 273 tons. This is a function of an unusual combination. On the one hand, we’ve got incredibly buoyant stock markets. Then on the other hand, we’ve got economic uncertainty…”
“Investment demand increased by 4%, reaching 279 tons. Within that, exchange-traded funds saw their first positive inflows since Q4 2012, as Western investors’ attitudes toward gold became more benign and bearish sentiment subsided a little bit. If we look at the bar and coin market, bar and coin demand was down 10% year-on-year. This was largely a result of very buoyant stock markets in a number of countries…”
