Global gold demand reaches USD 14.5 billion in Q2

Mumbai, Aug 15 (UNI) The global demand for gold jewellery showed the strongest surge, reaching a record of USD 14.5 billion, 37 per cent higher than Q2 2006, with particular strength across the key gold markets of Greater China, India, the Middle East and Turkey.

The growing acceptance by consumers of a price that averaged six per cent above the same period a year ago, and strong economic performances in the key consuming regions all helped gold to set records in the second quarter and a return to more normal levels of gold price volatility, Gold Demand Trends, released by the World Gold Council(WGC) revealed here today.

In tonnage terms India, the world's largest gold market, achieved all-time records in both jewellery and retail investment. Turkey achieved second-quarter records for both categories while Russia recorded its highest ever level of jewellery demand.

At 317 tonnes, India's total demand for gold in Q2 2007 was equivalent to half the global mine output for the quarter. More stable gold prices, a booming economy and the increasingly successful Akshaya Thritiya festival in April all contributed to a strong second quarter despite prices being in the mid-USD 600s/oz.

Globally, net retail investment rose by 51 per cent in tonnage terms to 132.9 tonnes, and 60 per cent in dollar terms to USD2.9 billion, compared to Q2 2006. Total identifiable investment fell just 4.8 per cent in tonnage terms to 130.4 tonnes and was one per cent higher in dollar terms at USD2.8 billion compared with Q2 2006.

Global industrial demand saw a further steady increase over year-earlier levels of two per cent in tonnage terms to 116.5 tonnes; this was equivalent to a nine per cent increase in value terms to USD2.5 billion, a new quarterly record.

Gold supply remained constrained in Q2. Stable prices reduced the supply of scrap, and this served to offset increased central bank selling.

UNI