Insights

Central banks reported 12t of net buying in June via the IMF and other public data sources. Demand moderated during the month: monthly gross purchases of 31t were offset by gross sales of 18t.

Gold import duty was cut by more than half. Long-term capital gains tax on gold has been adjusted down and the holding period decreased. Profits on gold ETFs and mutual funds will no longer be taxed at the short-term capital gains rate if held for at least 12 months. Despite some potential short-term disruptions, we expect the combined effects of these changes to add at least 50t to gold demand in H2 2024.

In this episode, live from the IPMI Conference in Orlando, Florida, hosts John Reade and Joe Cavatoni from the World Gold Council interview Philip Newman, Founding Partner of Metals Focus, to discuss the intricacies of the global bar and coin market. 

Global and domestic gold prices stay elevated, y-t-d gains at 16%. Jewellery demand subdued; investment demand dominant. Significant widening of discounts between domestic and international gold prices. The Reserve Bank of India (RBI) grows its gold reserves with its highest monthly purchase in nearly two years in June. Gold ETFs inflows sustain momentum in June. Steady trend in gold imports.

In June, China’s wholesale gold demand remained weak, ending H1 with little changes compared to 2023. Chinese gold ETFs saw their seventh consecutive monthly inflow, pushing both of their assets under management and holdings to record highs. Meanwhile, the People’s Bank of China reported no gold reserve changes.

Our survey of 525 professional investors in North America reveals that gold ownership is commonplace, and many of its investment benefits widely recognised.

Gold rose to a new all-time high in mid-May before pulling back, likely on profit taking, to close the month at US$2,343/oz. This delivered a 1% monthly increase, adding to gains in March (9%) and April (5%).

In May, China’s wholesale gold demand fell as gold jewellery consumption and bar and coin sales cooled. Meanwhile, the local central bank didn’t report any gold purchase during the month. But the bright spot came from the gold ETF market which extended the inflow streak to six months.

The rapid rise in the gold price during March raised  several questions. One of these was whether central banks – whose demand has been posited as a key reason for the recent rally – would change their gold buying behaviour in response.

In this episode of "Unearthed," hosts Joe Cavatoni and John Reade speak with George Burns, President and Chief Executive Officer, Eldorado Gold, discussing critical minerals and the role of gold in our world.

International and domestic gold prices moderated from the April peaks but ended the month with gains following the notable price rise of March. After a weak March and April, there was resurgence in gold demand around the Akshaya Tritiya festival. Domestic gold prices continue to trade at a discount in relation to the international prices, but the discounts have narrowed from a month ago. Meanwhile, the RBI added to its gold reserves in April and gold ETFs witnessed outflows for the first time in 12 months.

In Q4’23 gold miners’ global average all-in sustaining costs (AISC) rose again, up 2% q/q to US$1,342/oz as persistent cost inflation and a tight labour market continued to influence on-site operating costs. There is a silver lining however, because the rate of increase is slowing and the higher gold price has eased pressure on producer margins. 

In April, China’s wholesale gold demand climbed further as strong investment demand canceled off jewellery sector weaknesses. Chinese gold ETFs registered their strongest month on record whilst the local central bank announced gold purchases for the 18th consecutive month.

Central banks reported 16t of net buying in March via the IMF and other public data sources. Demand remained healthy: monthly gross purchases were steady m/m at 40t, partly offset by gross sales of 25t.

International and domestic gold prices have risen to unprecedented levels. The price surge has impacted jewellery demand but stimulated investment (bar and coin) demand. Domestic gold prices continues to trade at a discount in relation to the international prices. Meanwhile, the RBI added to its gold reserves in March, inflows into gold ETFs moderated and imports saw a sharp fall. 

In March, China’s official gold holdings rose for the 17th consecutive month and inflows into local gold ETFs continued. Meanwhile, withdrawals from the Shanghai Gold Exchange fell slightly, leading to a lower local gold price premium. Nonetheless, wholesale demand recorded the highest Q1 total since 2019.

Data for February shows that reported global central bank gold reserves rose by 19t, the ninth consecutive month of growth. At the same time February’s buying was 58% lower than January’s total of 45t.