On July 29, the “Global Gold Demand Trend Report” released by the World Gold Council (WGC) showed that in the second quarter of this year, global gold consumption and investment demand increased. The total global gold demand reached 955.1 tons, an increase from the previous quarter. 9%, basically the same as the same period last year (960.5 tons).
However, judging from the first half of this year, the total global gold demand was 1833.1 tons, a year-on-year decrease of 10%. The main reason was that despite the strong recovery of global gold consumption demand in the second quarter, the net inflow of gold ETFs in the second quarter could hardly match the large outflow in the first quarter. .
In the second quarter, central banks made steady progress in buying gold, and global official gold reserves increased by 199.9 tons. The large-scale gold purchases by the central banks of Thailand, Hungary, and Brazil have promoted the increase in global official gold reserves. At the same time, the central bank’s net purchases of gold in the first half of this year reached 333.2 tons, 39% higher than the average level of gold purchases in the first half of the past five years, and 29% higher than the average of the past 10 years.
The report shows that the total supply of gold in the second quarter increased by 13% year-on-year, and the total supply in the first half of the year increased by 4% year-on-year. The second quarter of 2020 is the quarter most severely affected by the new crown pneumonia epidemic. In contrast, the second quarter of this year has relatively little interference on the gold supply side.
Louise Street, a senior market analyst at the World Gold Council, said: “Looking forward, we are optimistic about the demand for gold consumption in the second half of this year. Although the global gold ETF holdings this year are likely to not reproduce the glory of 2020, it is considered effective. With the need for risk hedging and the continued low interest rate environment, we believe investors will strategically increase the proportion of gold in their investment portfolio in the second half of this year.”
Looking ahead to the demand for gold throughout the year, the World Gold Council predicts that the global demand for gold jewellery in 2021 may be between 1600 and 1800 tons, which will be much higher than the demand for gold jewellery in 2020, but may still be lower than the average level of the past five years; global gold The physical investment demand should be between 1,250 to 1,400 tons, or slightly lower than last year, but it is expected to be basically the same as the average level in the past 10 years; central banks are expected to continue to maintain the pace of net purchases of gold in 2020 or higher. In addition, the global gold supply is expected to achieve a small increase compared with last year.
For the Chinese market, Wang Lixin, CEO of the World Gold Council in China, said that in the second quarter, China’s gold demand rose year-on-year in many aspects. In general, China’s gold demand in the first half of the year increased significantly year-on-year, and investment demand was mainly released in the first quarter. The trend and seasonal characteristics of economic growth are expected to support gold demand in the second half of the year.