DUBAI: Total identifiable gold demand for Q3’09 reached 800.3 tons, or $24.7 billion in dollar terms, up 15 percent from Q2, as gold’s long-term store of value and wealth preservation qualities continued to attract investors and consumers.
Jewelry and investment demand in non-Western markets rebound from the very low levels seen in Q1, while industrial demand started to recover in response to an improvement in economic conditions. However, the Q3’09 Gold Demand Trends Report, released on Sunday by the World Gold Council (WGC), shows a 34 percent drop on year earlier levels due to an exceptionally strong Q3’08.
The demand soared in response to the deepening global financial crisis and as many non-Western markets responded to a dip in the gold price in that quarter. To address this, WGC compared Q3’09 against the five-year Q3 demand average to 2007, which showed tonnage down just four percent on this basis. Total demand for gold in the Middle East in Q3’09 was down a third when compared to the exceptionally strong quarter recorded in Q3’08, but up six percent on Q2’09 levels.
When looking at the more representative five-year September quarter average comparison, this shows a tonnage decline of 14 percent. Jewelry demand for Q3’09 compared with Q3’08 was down 34 percent (but up two percent quarter on quarter), while retail investment demand was down 11 percent compared with Q3’08 (but up 71 percent quarter on quarter).
The figures, compiled independently for WGC by GFMS Limited, show that average gold prices for the quarter were 10 percent higher than in Q3’08 at $960/oz.