World Gold Council’s Gold Demand Trends 2023 report

on Feb 1, 2024
  • The World Gold Council's Gold Demand Trends report showed average price for 2023 at an all-time high.
  • Central bank demand remained strong.
  • Economic uncertainty, geopolitical headwinds, and a global election cycle are expected to support 2024 prices.

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The World Gold Council’s (WGC) latest Gold Demand Trends for 2023 reported firm demand on robust central bank purchases and jewellery consumption, despite strong ETF outflows from Europe.  

Overall, the report offered positive news even as interest rates were elevated and economic growth was projected to slow.

The full-year report found that total demand excluding and including OTCs was at 4,448t and 4,899t, registering an annualized decline of (-)5% and an increase of 3%, respectively.

Despite the dip in Q4 2023 from the previous quarter, demand (excluding OTCs and stock flows) was at 1,150t, which was 8% above the 5-year average.

Even as ETF outflows thickened, strong OTC investment pushed gold prices to register a 15% increase during the year, while the average price was recorded at US$1,940.54 /oz – an 8% increase over 2022.

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This also marked the highest average price for a year on record.

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The authors of the report stated,

The net outcome of a double-digit gold price return (USD) suggests that hidden within the opaque OTC and Other category was some healthy demand from investors.

Thus, OTC demand has likely played an important role in driving gold to higher prices.

In addition,

The main themes underlying these developments were the avoidance of a US recession, continued weakness and asset volatility in China, as well as no let-up in global geopolitical tension.

In terms of central bank demand, purchases remained high amid still-elevated inflation and rising geopolitical uncertainty.

In 2023, total central bank purchases were at 1,037t, i.e., within striking distance of the all-time high.

Source: World Gold Council

However, despite the strength in the OTCs and purchases by monetary authorities, ETFs continued to bleed for a third year in a row, amounting to outflows of 244t which were heavily concentrated in the European market.

Weak European appetite led by German buyers spilled over into the bar and coin market, which witnessed a crash in demand by 59% across the region.

On the global stage, the category witnessed a 3% decline for the year, supported by heavy buying in China, India, Turkey, and the US.

The jewellery market remained robust and was largely powered by China which exercised a 10% increase in annual demand even as India saw a (-)6% decline.

India slipped to the second position in jewellery demand while China took the top spot.

However, global demand was virtually unchanged at 2,092.6t for the year.

Total market supplies of gold increased by 3% to 3,644t on the back of a 1% increase in mining output and a 9% increase in recycling.

This reached the second-highest on record, falling just short of 2018 output.

Monetary policy and geopolitical developments

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Moving forward, monetary policy demand and the increased uncertainty amid accelerated geopolitical fragmentation will be key drivers for demand through 2024.

Source: IMF

Other than the conflicts in Ukraine, between Israel-Palestine, and the violence in the Red Sea; and intensifying trade tensions, this year’s 60+ major elections may prove particularly supportive of gold’s store-of-value properties.

For instance, our December 4 article, discusses the sudden spike in gold prices to all-time highs of $2,152.30 in response to a US warship shooting down drones over the Red Sea.

As a result of the larger geopolitical scenario, both central bank and consumer demand are expected to be firm throughout 2024.


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That is not to say that the market shouldn’t expect its fair share of volatility ahead.

The yellow metal’s high liquidity means that it is often utilised to cover margins, and is also rapidly impacted by macroeconomic announcements, some of which may relate to high-frequency indicators.

Moreover, from the Fed’s announcement, it is unclear when a rate cut may ultimately take effect, and this uncertainty is likely to continue at least through Q1 2024.

Our update on the first FOMC meeting of the year is available here.

Recent economic data from the US has been strong, while inflation is likely still too high, which may further delay plans to cut rates, although the Fed is expected to do so at some point this year.


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For the time being, the price of gold has stabilized comfortably over the psychologically important $ 2,000 mark.

Even as the report acknowledges that recession risks persist, the key elements of the WGC’s 2024 outlook are:

  • Central banks are expected to buy gold, likely in excess of 500t, as the WGC believes “a longer-term strategy is at play here”
  • Total investment (including the more opaque OTC) shall likely rise
  • ETF outflows are expected to continue for the time being but shall ‘turnaround by mid-year’ amid rate cuts
  • Bar and coin demand will stay healthy as European weakness is compensated for by Chinese and Indian demand
  • Economic slowdowns may reduce jewellery demand, although sustainably lower inflation may spur demand; while technology demand should benefit from AI and semiconductor growth
  • Supply will continue to rise as capacities increase and higher-grade excavations come online
  • Overall, recycling demand has not responded to the increased price of gold in 2023 and is not expected to see significant growth this year
  • A soft landing would prove ‘neutral to mildly positive for gold’

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