Local consumer gold demand growth highest in Asean

Consumer gold demand in Thailand continues to show the highest growth among Asean countries for the second consecutive quarter, according to the World Gold Council (WGC).
Thai demand in the third quarter of 2024 increased by 11% year-on-year‎ to 14.5 tonnes, it said.
Global gold demand also remained strong, rising 5% from a year earlier to 1,313 tonnes, marking a record third quarter. The value exceeded $100 billion for the first time on record, supported by a record-high price environment.
Global investment demand more than doubled year-on-year to 364 tonnes, driven by a shift in demand for gold exchange-traded funds (ETFs), primarily from Western investors. Globally, gold ETFs added 95 tonnes, marking the first positive quarter since the first quarter of 2022.
Even though global bar and coin demand fell 9% in the third quarter, demand in Thailand rose 15%, reaching 12.1 tonnes. However, the global year-to-date total remains strong at 859 tonnes compared to the 10-year average of 774 tonnes.
“Consumer demand in Thailand was resilient, partly due to ‎the long-awaited digital wallet handout announcement that will also include cash payments to boost the local economy,” said Shaokai Fan, head of Asia-Pacific (ex-China) at ‎the WGC.
“The ‎government began rolling out the programme at the end ‎of the third quarter, which may help support demand in the fourth quarter.‎
“Global geopolitical tensions, local political and economic ‎concerns and bullish price expectations buoyed Asean ‎investors’ appetite for gold in the third quarter. Thailand, Indonesia ‎and Malaysia all recorded double-digit growth.”
Central bank buying of gold slowed in the third quarter though demand remained robust at 186 tonnes. For the year to date, central bank demand reached 694 tonnes, in line with the same period of 2022.
Gold prices continued to rise to record highs during the quarter, reaching an average of $2,474 an ounce, hampering global demand for gold jewellery. Total jewellery consumption was down 12% year-on-year on a volume basis, but up 13% in value terms, suggesting that consumers are comfortable spending more on lower quantities of gold products.
In addition, total demand for gold in technology grew 7% year-on-year, bolstered by growth from the electronics sector as the AI boom continues to support demand for gold.
Total gold supply increased 5% year-on-year, with a jump of 6% in mine production and an 11% rise in recycling.
“The third quarter saw increased investment and over-the-counter activity prop up global gold demand and drive price performance,” said Louise Street, senior markets analyst at the WGC. “While the higher gold price dampened demand in the majority of consumer markets, the [import] duty cut in India kept jewellery and bar and coin demand remarkably high in a record-breaking price environment.
“A ‘FOMO [fear of missing out] factor’ among investors has been a key driver of increased demand this quarter. Investors have shown an appetite to buy into the price momentum, are encouraged by the prospect of future interest rate decreases, and are also considering gold’s role as a safe haven in the face of US political uncertainty and escalating conflicts in the Middle East.
“Looking ahead, the step-change in gold investment flows is a trend that is likely to continue, which could keep both demand and price levels elevated. On the other hand, we’ve seen over 30 record price highs in 2024, and that environment will continue to be challenging for consumers. However, the prospect of economic growth is another factor we will be watching that could tip the scales.”