Consumer investment in gold increased in the second quarter of 2021 but
some investors were less bullish, according to the World Gold Council’s latest Gold Demand Trends report. The two forces helped create a gold demand of 955.1t over the quarter – a 9% rise from Q1 2021, and in line with the equivalent period last year (960.5t).
Between April and June, most traditional indicators of consumer gold purchasing were positive. Bars and coins – a category of physical gold products overwhelmingly bought by retail investors* – saw a fourth consecutive quarter of year-on-year gains, with 243.8t purchased over the three- month period.
Louise Street, Senior Markets Analyst at the World Gold Council, commented: “As the
global economic recovery continues, we have been encouraged to see consumer demand returning, with strong year-on-year growth in jewellery.
While both consumers and retail investors were purchasing again, institutional investors were less consistent. There were only modest net inflows of 40.7t during Q2 into gold Exchange Traded Funds (ETFs) – financial instruments backed by physical gold whose flow “swings” are often driven by institutional buyers. These inflows only partially offset the heavy outflows the industry witnessed in the previous quarter, making 2021 the first time since 2014 with net outflows in the first six months of the year.