It is also energy intensive, so until renewable energy becomes the norm this means it will be carbon intensive. This includes their ability to expand and accelerate decarbonisation and as well as them making positive contributions to environmental protection and conservation. Whether you’re new to online auctions or sell professionally, we can help you earn more for your special objects.
According to the data, investment demand in the safe-haven metal rose by more than double to stand at 364 tonne. This was fuelled by a rise in the demand for gold exchange-traded fund (ETF), where investors from the west seemed to repose a lot of trust. The demand for ETFs was evident from the fact that July-September 2024 marked the first quarter since 2022 when ETF demand rose, standing at 95 tonne. However, a dip was recorded in the gold coins and bars during the same quarter (which is also Q2 FY25) to the extent of 9%.
Central banks are also expected to keep adding to their holdings, which should offer support. Mine production posted another gain in 2023, up 1% to 3,644t, although this total fell just short of the 3,656t record set in 2018. After a strong first half we had expected 2023 to mark a new high for the global gold mining industry, but the growth rates seen in the first two quarters were not replicated in the second half of the year. Mine production in Q4’23 fell 2% y/y to 931t, resulting in a weaker H2 than expected. This, together with some minor downward revisions to H1’23, left global mine production a fraction lower than in 2018. The Reserve Bank of India’s net gold buying in the first two months of 2024 (13.4 tonne) already amounts to more than 80% of its 2023 annual net purchase of 16.2 tonne, and represents the largest purchase for the period since 2015.
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Looking ahead, potential stability in the economy and possible further stimuli should help trim gold jewellery demand weakness, expected declines in yields and a likely weaker local currency may support gold investment demand. Adding to the demand worries are domestic gold prices that have risen to all-time highs, presenting a major headwind. The upcoming Lok Sabha elections and the recent surge in gold prices will stall demand for the yellow metal in India, according to the World Gold Council.
- Inflation has been so low for so long it’s easy to overlook the impact that two years of high inflation have had on real gold prices.
- Recycling rose y/y in all four quarters, with the largest increase (+13% y/y) in Q2’23 when the US dollar gold price surged to a new quarterly average high.
- The US presidential election in November and the long-awaited US Fed rate cut will also continue to add to gold’s upward momentum through to the end of the year, in our view.
- Assets under management stood at $3.6 billion, while total holdings was at 44.7 tonne, down 0.7%.
- Any references to LBMA Gold Price are used with the permission of ICE Benchmark Administration Limited and have been provided for informational purposes only.
In rich Middle Eastern countries there appears to be no incentive or need to sell gold when the price is performing well. We often highlight that quarterly recycling is more sensitive to shorter-term increases in the gold price and there was evidence that this continued to be the case in 2023. The q/q change in recycling in each quarter mirrored the direction of the q/q change in the quarterly average gold price, as consumers looked to cash in when the price rose. Q3’23 was the only quarter to register a q/q decline in recycling, when the quarterly average gold price fell by 2% q/q. The supply of recycled gold increased 9% y/y to 1,237t in 2023 as gold moved to record highs in almost every currency. Recycling rose y/y in all four quarters, with the largest increase (+13% y/y) in Q2’23 when the US dollar gold price surged to a new quarterly average high.
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While the dizzy prices of gold possibly led to subdued purchase by central banks of different countries, the central bank to record the biggest buy of the precious metal in this quarter was the National Bank of Poland. The cumulative purchases of the central banks went down by as much as 49% and reached 186.2 tonne. Significantly, the total purchases by central banks in the world in the corresponding period in 2023 stood at 363.9 tonne. WCG said the high gold prices prompted some central banks to sell from their reserves and book handsome gains. Gold prices continued their northward march in Q2 FY25 and touched an average price level of $2,474 an ounce. It declined by as much as 12% on volume parameters but rose 13% on terms of value.
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Our client-centric approach and corresponding products and services ensure businesses have the support they need to confidently realize their vision. The CSE offers global investors access to an innovative collection of growing and mature companies. We still expect central bank demand to remain strong looking ahead amid the current economic climate and geopolitical tensions. Given the uncertainty surrounding the elections, gold is likely to attract safe-haven demand, potentially adding upside pressure on prices, said Sugandha Sachdeva, market expert and founder of SS WealthStreet. Data shows that gold consumption has fallen during three of the last four general election periods, with a decline in demand for both jewellery and bar and coin, the WGC said in a report on Tuesday. The World Cyber Games (WCG) is an international esports competition with multi-game titles in which hundreds of esports athletes from around the world participate in a variety of competitions also known as Esports Olympics.
- The People’s Bank of China didn’t add gold to its reserves for a second consecutive month in June.
- The cumulative purchases of the central banks went down by as much as 49% and reached 186.2 tonne.
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- As much of the gold market depends on discretionary spending of some sort, gold miners have a particular need to prove the net positive impacts of their activities.
- Of course, this does not rule out a return to more widespread hedging should gold head lower and mining companies start to worry about maintaining profitability.
- The Exchange’s efficient operating model, advanced technology and competitive fee structure help its listed issuers of all sectors and sizes minimize their cost of capital and enhance global liquidity.
The elections will be held in seven phases starting April 19 and conclude in the first week of June. Complete cryptocurrency market coverage with live coin prices, charts and crypto market cap featuring coins on 926 exchanges. “Buyers may delay purchases in anticipation of more favourable pricing,” Sachdeva said, adding consumers eventually adjust to new price levels as demand tends to be resilient over the long term.
Preliminary estimates suggest a small increase in outstanding producer hedge books but the large amount of positions due to mature in Q4 mean there is lower than usual confidence about the end-of-year position for the gold mining industry. We believe that geopolitics will remain one of the key factors driving gold prices. The war in Ukraine and the Middle East and tensions between the US and China suggest that safe-haven demand wcg gold price will continue to support gold prices in the short to medium term. The US presidential election in November and the long-awaited US Fed rate cut will also continue to add to gold’s upward momentum through to the end of the year, in our view.
ETF flows turn positive in May after 12-month losing streak
The past year has been a useful test of the presumption that gold mining companies are reluctant to expand their hedging activities. Of course, this does not rule out a return to more widespread hedging should gold head lower and mining companies start to worry about maintaining profitability. Gold mining costs continued to increase in Q3’23 (the latest quarter for which data is available) but further signs of slowing cost growth were evident.
Neither WGC nor Oxford Economics provides any warranty or guarantee regarding the functionality of the tool, including without limitation any projections, estimates or calculations. This information is not a recommendation or an offer for the purchase or sale of gold or any products, services, or securities. Any references to LBMA Gold Price are used with the permission of ICE Benchmark Administration Limited and have been provided for informational purposes only. ICE Benchmark Administration Limited accepts no liability or responsibility for the accuracy of the prices or the underlying product to which the prices may be referenced. All third-party content is the intellectual property of the respective third party and all rights are reserved to such party.
Bullion held by the PBoC was unchanged at 72.8 million troy ounces at the end of last month. It is notable that full year recycled gold supply was almost 30% lower than the record high set in 2009, despite 2023’s record average gold price. First, there were very few references to distress selling of old jewellery, a sharp contrast to the situation during the Global Financial and eurozone crises. Extensive fiscal support for consumers and businesses during the pandemic protected employment while energy subsidies in Europe following the Russian invasion of Ukraine helped insulate the public from surging energy prices. Central bank buying continued in May, with 10 tonnes of net buying during the month, however demand moderated during the month. May’s purchases were led by emerging market central banks with the National Bank of Poland the largest gold purchaser, followed by the Central Bank of Turkey and the Reserve Bank of India, according to data from the World Gold Council (WGC).