Gold demand hits new records in 2024, and that was before the 2025 jump. Central banks and investors drove the 2024 market strength

	2023	2024	Annual y/y % change		Q4'23	Q4'24	Quarterly y/y % change
Supply
Mine production	3,644.1	3,661.2		0	955.4	953.6		0
Net producer hedging	67.4	-56.8		-	19.9	-15.0		-
Recycled gold	1,234.4	1,370.0		11	311.2	358.8		15
Total Supply	4,945.9	4,974.5		1	1,286.5	1,297.4		1
Demand
Jewellery fabrication	2,191.0	2,003.5		-9	583.6	516.5		-12
Jewellery consumption	2,110.6	1,877.1		-11	620.9	547.1		-12
Jewellery inventory	80.4	126.4		57	-37.3	-30.6		-
Technology	305.2	326.1		7	82.2	83.7		2
Electronics	248.7	270.6		9	67.6	69.6		3
Other Industrial	47.1	46.5		-1	12.3	11.9		-4
Dentistry	9.4	8.9		-5	2.3	2.2		-6
Investment	945.5	1,179.5		25	259.8	344.0		32
Total bar and coin	1,189.8	1,186.3		0	315.2	325.4		3
Bars	781.7	860.0		10	223.1	236.2		6
Official coins	293.5	201.0		-31	60.3	53.4		-11
Medals/Imitation coins	114.6	125.2		9	31.9	35.8		12
ETFs & similar products	-244.2	-6.8		-	-55.4	18.6		-
Central banks & other inst.	1,050.8	1,044.6		-1	216.8	332.9		54
Gold demand	4,492.5	4,553.7		1	1,142.4	1,277.1		12
OTC and other	453.4	420.7		-7	144.1	20.3		-86
Total Demand	4,945.9	4,974.5		1	1,286.5	1,297.4		1
LBMA Gold Price (US$/oz)	1,940.5	2,386.2		23	1,971.5	2,663.4		35

Source: Metals Focus, Refinitiv GFMS, ICE Benchmark Administration, World Gold Council
Note: For an explanation of these terms, please see the Notes and definitions download:
https://www.gold.org/goldhub/data/gold-demand-by-country

Outlook

We expect central banks to stay in the driving seat and gold ETF investors to join the fray. Jewellery demand will remain under pressure and we may see further growth in recycling. Mine supply is expected to remain robust

The macroeconomic backdrop we laid out in our Gold Outlook 2025 is broadly in line with market expectations with some changes, partly reflected by less aggressive rate cuts by central banks.

In line with consensus economic estimates, the following developments are likely in the four major gold regions:¹ 

• A soft landing in the US with intermittent risks of overheating. Interest rates recede slowly but it’s a bumpy ride. The US dollar on course to decline
• European growth remains weak but benefits from both lower inflation and rates in the latter half of the year; any additional pickup in Chinese growth can provide a welcome boost to exports 
• China continues to battle weak domestic activity but could improve on continued stimulus measures that have seen a nascent recovery in retail and property sales
• India sees slowest growth in four years – albeit higher than most regions – accompanied by a welcome decline in interest rates and inflation.

Chart 2: We see central banks and ETF investors at the forefront, while consumer-led sectors face challenges in 2025

Expected change in annual gold demand*

We see tailwinds for gold ETF, OTC and futures-based investment stemming from generally lower interest rates, richly valued equities, a softer US dollar and geopolitical risk mostly expressed though trade and economic uncertainty. 

We expect the trajectory for rates in the US will be down but bumpy, given the Trump administration’s all-out pro-growth agenda stoking temporary inflationary fires in a late business cycle. This uncertainty is likely to keep term premia intact and the bond-equity correlation elevated – a positive for gold. In addition, there’s potential for US dollar weakness stemming from a combination of ‘extreme’ overvaluation² and a push for both lower rates and a more competitive dollar by the administration,³ as well as a likely narrowing in German Bund-US Treasury spreads as German elections push local growth policies to the fore.

Regionally, gold ETF investment in the US has the potential to bring in substantial flows overall, even if we see transient periods of outflows. In Europe, the ECB is expected to cut rates by 1% during 2025.⁴  This could be enough to get some European ETF investors back in the fold. However, it might be a slow return given that real rates remain attractively positive at close to 1%, one factor that anecdotally drove investors out of European ETFs in 2023.

China’s ETF demand hit a record in 2024. We expect robust rather than remarkable demand there this year, with tailwinds from RMB weakness and declining benchmark yields fighting headwinds from the high base and the possibility for risk-on sentiment.

In the bar and coin segment, the outlook is a little less rosy. In the West, economic malaise in Europe and high prices are likely to weigh on demand as will declining inflation fears and conflict risk, but lower interest rates might attract European activity back in H2. In the US, Republican presidencies have historically been accompanied by below-average bar and coin demand; however, the geopolitical environment could soften the pullback. Chinese and Indian demand is likely to remain robust but slightly weaker than 2024 as growth slows in India and equity and real estate markets recover somewhat in China offering alternatives to domestic investors.

Fabrication

If the gold price remains at current or higher levels, it could further erode jewellery demand, particularly as growth is also weak or slowing in all four major gold regions. China faces a pessimistic outlook should the economy continue to slow and prices stay high or rise. A glimmer of hope may come from benchmark lending rates which have come down, which could entice a pickup in activity. 

More auspicious wedding days can provide some support to jewellery demand in India following a resilient 2024. Key to the fortunes of Indian jewellery buying is stable prices. With economic growth set to slow but still humming along at an impressive pace, price volatility becomes a key determinant for demand in 2025. Elsewhere, the familiar tale of softer economic growth and high prices will likely exert pressure on demand in 2025.

Continued capital investment in AI and its related infrastructure should ensure technology demand remains solid in 2025. Other electronic demand will likely continue to be weighed down by economic uncertainty in China and Europe.

Central Banks

Having positively surprised for three years in a row, there’s more evidence that supports the idea that central banks can repeat again their 1,000t-plus net buying in 2025. However, we reserve caution by reflecting it in potential downside risk rather than our central view.

We believe that armed conflict giving way to global trade and economic conflict may support central bank’s net buying trend. We can see this in part by the pickup and broadening of demand, especially in Q4. Further, central banks seem to have taken advantage of temporary pullbacks in the gold price as entry points, while sales remained limited and mostly tactical as the price rose. Yet, forecasting demand for central banks is inherently challenging given that it’s often linked to policy decisions and not just macroeconomic drivers, leading us to widen the band of uncertainty around our estimate – mostly to the downside. For example, recent announcements of sales to manage currency volatility⁵ leads us to account for the risk further such developments elsewhere.

Supply

High margins provide an incentive for mine production to reach new highs, but downside risks remain. This year’s total was lower than previously anticipated, so we attach caution to a material rise, despite near-record AISC margins currently. De-hedging’s contribution to the lower mine supply figure could also be a factor next year as miners anecdotally opt for exposure to the spot price.

Recycled gold supply breached 350t in Q4 for only the fourth time in a decade. The trend is rising and tonnage is expected to increase again in 2025 on the back of slowing global economic growth, a high gold price level, and a slight reduction in the geopolitical risk premium that’s been key to dampening supply for the past two years. Constraining higher recycling is a lack of near market supplies in China and Western markets.