Gold hits lowest demand in decade: WGC

In this file photo taken on 11 August, 2017 an employee of an Indian jewellery store arranges gold jewellery in a display at a stall in the Asia Jewels Fair 2017, in Bangalore. Photo: AFP
In this file photo taken on 11 August, 2017 an employee of an Indian jewellery store arranges gold jewellery in a display at a stall in the Asia Jewels Fair 2017, in Bangalore. Photo: AFP

Global gold demand hit the lowest first-quarter level in a decade as low price growth took the shine off investment appetite, industry body the World Gold Council said Thursday.

Global annual demand sank seven per cent to 974 tonnes in the first three months of 2018, the WGC said in a performance report on the precious metal.

That was the weakest first-quarter level since the same portion of 2008 and compared with 1,047 tonnes in the first quarter of 2017.

The WGC said the "main cause was a fall in investment demand" as gold prices limited gains.

Gold, seen as a safe haven investment in times of economic turbulence, saw its price struggle faced with uncertainty over the health of the United States economy.

"There are mixed signals on the US economy and no clear direction on the gold price," WGC spokesman John Mulligan told AFP.

The main two drivers of gold market are investment buying and jewellery.

In the first quarter, investment demand collapsed by almost a third to 287 tonnes compared with a year earlier.

Jewellery demand was stable at about 488 tonnes, as Chinese growth partly compensated for weaker Indian demand.

Gold prices put on 2.5 per cent during the quarter to finish at $1,341.24 per ounce. It traded at $1,309.95 on Thursday.