RAPAPORT... Global gold demand by value plummeted 28 percent year on year to $170.4 billion in 2013, according to the World Gold Council. By volume, gold demand dropped 15 percent to 3,756 tonnes. However, gold jewelry demand by weight surged 17 percent year on year to 2,209.5 tonnes even though gold jewelry demand by value fell slightly to $100.25 billion compared with $101.75 billion in 2012. The World Gold Council noted that that average price of gold fell 27 percent during 2013 to $1,411.20 per ounce.
During the fourth quarter, gold jewelry demand by weight fell 2 percent year on year in India to 150.7 tonnes; however, demand jumped 10 percent to 160.5 tonnes in Greater China. Gold jewelry demand surged 21 percent in the U.S. to 48.4 tonnes and rose 8 percent in Europe to 24.1 tonnes. Demand from the Middle East fell 2 percent to 33.3 tonnes, primarily due to severe economic strife in Egypt.
By dollar value, jewelry demand fell across the board during the fourth quarter due to lower prices. India's gold jewelry demand dropped 27 percent year on year to $6.183 billion, China's demand fell 18 percent to $6.585 billion, the Middle East declined 4 percent to $496 million, while in the U.S., gold jewelry demand plunged 10 percent to $1.986 billion and in Europe demand plummeted 20 percent to $989 million.
The World Gold Council concluded that jewelry demand by volume during 2013 experienced its largest increase in 16 years as consumers across the globe reacted positively to lower gold prices. Demand for bars and coins surged to an all-time high of 1,654.1 tonnes as individual investors took advantage of lower prices, while large-scale selling took place from more tactical exchange-traded funds (ETFs) by investors in the western economies, generating outflows of 880.8 tonnes. Annual gold demand for technology was flat at 404.8 tonnes, central bank net purchases rose by 368.6 tonnes and the global supply of gold declined 2 percent to 4,339.9 tonnes.