Global gold demand fell 6% in H1: World Gold Council


World gold demand fell by 6% in the first half of the year amid covid-induced supply shortages, although record high inflows into Exchange Traded Funds cushioned the impact, according to World Gold Council.

Demand during the second quarter declined by 11% to 1,015.7 tons.

“The covid-19 pandemic was again the main influence in the gold market in Q2, severely curtailing consumer demand while providing support for investment,” according to WGC.

It added that the global response to the pandemic by the central banks and governments, in the form of rate cuts and massive liquidity injections, fuelled record flows of 734 tons into gold-backed ETFs.

Gold prices have risen to record highs of $1,940/ounce in the past week due to huge investment demand, but most of the purchases have been in paper gold or gold traded electronically on exchanges.

On the other hand, jewellery demand slumped 46% on year to 572 tons in the year’s first half  as markets remained shut amid lockdown and consumers were deterred by the high price of gold.Investment demand for bars and coins also declined by 17%.

The demand for gold used in technology like electronics were also behind a 13% fall in demand during the same comparative period.

The supply of gold also fell by 6% to 2,192 tons globally during the period.

Central banks gold purchases fell by 39% during the first half to 233 tons, although the decline came on the back of record purchases during the same period last year.


Inflows into gold ETFs accelerated in Q2, taking H1 inflows to a record-breaking 734t. First half inflows surpassed the 2009 annual record of 646t and lifted global holdings to 3,621t.

The US dollar gold price gained 17% in H1, following a 10% increase during Q2. The gold price reached record highs in numerous currencies, including euros, sterling, rupee and renminbi among others. 

Investment in gold bars and coins slowed sharply in H1 2020, down by 17% to 396.7t – an eleven year low. Steep declines in demand across Asia outstripped growth in the West as investors’ reactions to the pandemic diverged across the globe.

H1 jewellery demand almost halved to 572t amid the global disruption caused by COVID-19. The impact of the pandemic was unsparing and Q2 demand fell to an unprecedented 251t.

Central banks bought 233t of gold during H1, 39% below 2019’s record level. Buying has become more concentrated, with fewer banks adding to reserves so far in 2020. 

Biman Mukherji is a columnist and consulting editor at He has worked for international news organisations such as Reuters, The Wall Street Journal as well as for newspapers like The Times of India. He can be reached at

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