Gold demand in China and Russia continue to rise, while poor economic conditions in the United States are causing consumers to shy away from the precious metal.According the World Gold Council’s (WGC’s) Gold Demand Trends report, global demand fell 21 per cent to 445.4 metric tonnes for the first quarter of 2008 over the same period last year. The decline is the lowest quarterly level since the early 1990s.
The first quarter of 2008 saw gold demand tumble by 16 per cent to a five-year low of 701 tonnes.
High and volatile prices hit India hard. The largest market for gold saw jewellery demand fell to 71 tonnes, half the level it was in the first quarter of 2007.
“Early indications are that jewellery demand is likely to remain muted during the second quarter, although there has been positive news from the Indian Akshaya Thritiya festival and the Indian and Middle East wedding seasons, which are expected to generate additional purchasing,” said WGC CEO James Burton.
U.S. demand declined 15 per cent to 48 tonnes, while China and Russia rose by 15 per cent and nine per cent, respectively. WGC attributes the increases to greater consumer wealth and more access to attractive jewellery and retail investment products.
