The World Gold Council (WGC) said demand for gold should rise this year, with jewellery demand in China and India growing, and increased industry investment being seen in Europe and the US.
WGC’s Gold Demand Trends report shows demand in India and China will continue to grow in spite of high local currency gold prices.
In Q1 this year, demand for gold increased 698% to 193.5t in India, while in China it rose by 11% to 105.2t.
In Europe, concerns over Greece’s public finances and debt contagion fears has led to increased demand for gold coins, bars and gold exchange traded funds during May.
WGC CEO Aram Shishmanian said European gold investment demand is exceptionally strong at present, especially from German and Swiss investors.
Global jewellery demand in non-Western countries will continue to recover after reaching 470.7t in Q1 2010 driven by economic recovery in Europe and the US.
In Q1 this year the volume of total identifiable gold demand dropped 25%, compared with the Q1 2009 levels at 760.2t.
In the first quarter, jewellery demand rose 291% to 147.5t in India, and Chinese demand continued to be strong while Turkey and the Middle East showed signs of recovery.
Net retail investment demand rose by 26% to 182.5t compared with the first quarter of 2009.