Informist, Friday, May 5, 2023

--WGC: Gold prices in Jan-Mar averaged $1,890/oz, up 1% on year

--Jan-Mar global gold demand at 1,081 tn, down 13% on year

--Central banks bought 228 tn gold in Jan-Mar, up 176% on year

--Jan-Mar global gold jewellery consumption at 478 tn, unch YoY

--Global gold ETF net outflow in Jan-Mar at 29 tn

--Jan-Mar global demand for gold bars, coins up 5% YoY at 302 tn

--Global investment demand for gold in Jan-Mar 274 tn, down 51%

--Global gold supply in Jan-Mar at 1,174 tn, up 1% on year

MUMBAI – Global demand for gold fell 13% on year to 1,081 tn in the March quarter due to weak demand from India, fall in global electronic sales, and outflow from exchange-traded funds, the World Gold Council said in its Gold Demand Trends report released today.

Globally, gold demand for jewellery in Jan-Mar was at 478 tn, flat from a year ago. "Jewellery fabrication exceeded consumption as stock building added just over 30 tn to global inventories," WGC said in the report.

Demand for bars and coins increased 5% on year to 302 tn in Jan-Mar. Total investment demand for the yellow metal fell 51% on year to 274 tn in the March quarter mainly due to negative demand for exchange-traded funds.

Global gold exchange-traded funds saw outflows of 29 tn in Jan-Mar, against inflows of 271 tn in the same period last year.

Demand from central banks grew significantly in March quarter to 228 tn compared with 83 tn in the same quarter a year ago. "The net buying rate in Q1 (Jan-Mar) sets the tone for a higher midpoint for our full-year estimate. We have also raised the downside range limit, although we maintain that this year is very unlikely to match 2022," WGC said in the report.

Gold prices were 8% higher in the March quarter and averaged $1,890 per ounce. They were 1% higher than in the same period of 2022.

"The mixed picture for Q1 highlights how gold's diverse sources of demand underpin its role and performance as a global asset. Growth in some regions offset weakness in others as different economic forces and demand drivers played out in the global gold market," said Louise Street, senior analyst at WGC.

"As some economies teeter on the brink of recession, gold's role as a long-term, strategic asset could take centre stage as it has a history of delivering positive returns in the last five out of seven recessions," Street said.

SUPPLY 

Globally, supply of gold was up 1% on year at 1,174.0 tn in Jan-Mar.

Production from mines rose 2% on year to 856 tn during the quarter. Quarter-on-quarter, mine production was down 10% due to seasonal fluctuations: open pit and alluvial operations cut back or stop altogether in some very cold climates, especially in China, Russia and other countries in the former Soviet Union, the WGC report said.

The supply of recycled gold rose 5% on year to 310 tn in Jan-Mar. End

US$1 = 81.80 rupees

Reported by Sandeep Sinha

Edited by Ashish Shirke

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