A 53% jump in consumer demand for gold in China and India during the second quarter was not enough to offset a heavy decline in Exchange Traded Fund purchases which fell 400 mt over the same period, leaving demand down 12% on year at 856 mt, the World Gold Council said Thursday.
"Gold held in gold-backed ETFs fell by just over 400 mt, driven by hedge funds and other speculative investors continuing to exit their positions. This was predominantly in the US," WGC said in its Trends report for April-June 2013.
Consumer, or physical, demand for gold was up 53% in Q2 led by strong growth in China and India, driven by lower prices. The countries are the largest markets for the precious metal.
"Globally, jewelry demand was up 37% in Q2 2013 to 576 mt from 421 mt in the same quarter last year, reaching its highest level since Q3 2008. In China, demand was up 54% compared to a year ago; while in India demand increased by 51%. There were also significant increases in demand for gold jewelry in other parts of the world: the Middle East region was up by 33%, and in Turkey demand grew by 38%," the report said.
