Bhubaneswar: The World Gold Council’s Q1 2025 Gold Demand Trends report reveals total quarterly gold demand (including OTC[1]) was 1,206t, a 1% increase year-on-year, in a record high price environment, in which gold surpassed US$3,000/oz.
The gold ETF revival fuelled a more-than doubling of total investment demand to 552t, a 170% year-on-year increase and the highest since Q1 2022. ETF inflows accelerated around the world, totalling226t in the first quarter as price momentum and tariff policy uncertainty drove investors to gold as a safe haven.
Total bar and coin demand increased 3% y/y, remaining elevated at 325t during Q1, spurred by a surge of retail investment in China, which posted its second-highest quarter on record. Eastern investors drove much of the global demand for bar and coin,offsetting Western weakness as appetite in the US dropped 22% year-on-year, alongside a modest 12t recovery in Europe, butfrom a very low base in the same quarter last year.
Central Banks are now entering their 16th consecutive year of net-buying, adding 244t to global reserves in Q1 amidst ongoing global uncertainty. While this level of demand was 21% lower year-on-year, it remains robust and in line with the quarterly average for the last three years of sustained,strong buying.
Unsurprisingly, jewellery demand was negatively impacted as gold hit 20 all-time price highs in Q1. Volumes reached their lowest point since demand was stifled by the COVID pandemic in 2020. However, the jewellery market remained relativelyresilient, especially in value terms,given extreme price pressures. The first quarter saw a 9% year-on-year increase in consumer spending to US$35bn with every market except China seeing an increase in the valueof gold jewellery demand.
Total gold supply was relatively flat year-on-year, at 1,206t in the first quarter as record Q1 mine production was offset by slightly lower recycling. Technology demand was also stableat 80t, compared to Q1 2024.
Louise Street, Senior Markets Analyst at the World Gold Council, commented: “It’s been a bumpy start to the year for global markets astrade turmoil, unpredictable US policy announcements, sustained geopolitical tensions and a return of recessionary fears have created ahighly uncertain environment for investors. In this context, investment demand for gold has paved the way for the highest level of first quarter demand since 2019.
“Over the past 10 monthsinvestors have returned to gold ETFs, ramping up their allocations since Q3 last year, and already in April,Asian inflows havestormed past their Q1 total.However, there is still room for growth, with global gold ETF holdings sitting 10% below their 2020 high.
“Looking ahead, the broader economic landscape remains difficultto predict, and that uncertainty could provide upside potential for gold. As turbulent times persist, safe havendemand for gold from institutions, individuals and the official sector could climb higher in the months to come.”
Sachin Jain, Regional CEO, India, World Gold Council said: India’s gold demand in Q1 2025 stood at 118.1 tonnes, total 15% drop from 139 tonnes in the same period last year. However, this decline in volume was offset by a 22% surge in the overall value of demand, propelled by soaring global gold priceswhich have risen 25% since January 2025. This historic rally of gold pricesreaching a record high of Rs 1 lakh per 10 grams in India, has further reinforced the metal’s appeal as a safe-haven asset among Indian consumers.
Investment demand remained resilient, rising 7% year-on-year to 46.7 tonnes, driven by growing interest in gold ETFs, digital gold, coins, and bars. Conversely, gold jewellery demand declined by 25% to 71.4 tonnes from 95.5 tonnes in Q1 2024, with elevated prices impacting affordability. Yet, the enduring cultural and seasonal significance of gold, especially ahead of key occasions like Akshaya Tritiya and the upcoming wedding seasoncontinues to support consumer buying sentiment.
Gold retailers too, are optimistic about favourable buying behaviour through the rest of the festive season, despite ongoing tariff-related uncertainties.The 8% rise in gold imports to 167.4 tonnes in Q1 2025 further reinforces this supply-side preparedness by Indian jewellery retailers. In contrast, gold recycling fell by 32% to 26 tonnes, as consumers retained their holdings amid record-high prices.
