WGC: Global gold demand remained surprisingly resilient in Q4 2015

SEATTLE (Scrap Monster): The World Gold Council (WGC) has released the Gold Demand Trends Report for the full year 2015. The report indicates that global demand for gold during the entire year remained almost unchanged at 4,212.2t, contracting marginally by 14t. Also, consumer demand for gold remained resilient during the last quarter of the previous year.

According to the report, the consumer demand for gold exceeded the five-year quarterly averages. The demand held firm in key markets-India and China. Unexpected demand growth was reported by other countries such as Japan, Vietnam and Iran. The demand for jewellery, bars and coins totaled 934.9t, slightly lower when matched with Q4 2014 demand of 938.3t. However, the Q4 ’15 demand surpassed the five-year average of 913.8t.

The Indian demand for jewellery, bars and coins surged higher by 6% to 233.2t during Q4 last year. This is despite several adverse factors including devastating flood conditions in Southern Indian state of Chennai, and deficient monsoons in Telengana. Falling rubber prices impacted buying power of consumers in the state of Kerala. These three South Indian states account for a major portion of the country’s gold demand.

Surprisingly, growth in festive season-related demand overcame the weakness in the south of the country. The weak gold prices during late-October and early-November lifted gold purchases during Dhanteras, Diwali festival and wedding season.

The Chinese gold demand was up 3% year-on-year at 250.6t during Q4 last year. The consumer demand for investment bars and coins surged higher by 25%. Jewellery demand dropped marginally by 1% when matched with the same quarter in 2014. ‘Golden week’ sales remained muted, but demand pickup was witnessed towards the end of the year. The retail gold sales in the country were up by 11% in December last year.

The consumer gold demand in Japan expanded for the third quarter in a row to touch 14.1t. Investment and jewellery demand have soared by 30% and 11% respectively in Iran. On the other hand, demand growth was hit by declines in Russia and Turkey, whose economies continued to struggle badly.