Global gold demand rose 1 per cent year-on-year in the first quarter of 2025 to 1,206 tonnes

The rebound in gold-backed exchange-traded funds (ETFs) was the standout driver, with investment demand more than doubling to 552 tonnes

Global gold demand rose 1 per cent year-on-year in the first quarter of 2025 to 1,206 tonnes, driven by a sharp increase in investment demand as prices surged past $3,000 per ounce, according to the World Gold Council’s (WGC) latest Gold Demand Trends report.

The rebound in gold-backed exchange-traded funds (ETFs) was the standout driver, with investment demand more than doubling to 552 tonnes — up 170 per cent year-on-year and the highest level since Q1 2022.

ETF inflows alone reached 226 tonnes, boosted by price momentum and rising global uncertainty linked to tariff policies and recessionary fears.

“Over the past 10 months investors have returned to gold ETFs, ramping up their allocations since Q3 last year,” said Louise Street, senior markets analyst at the WGC. Already in April, Asian inflows have stormed past their Q1 total. However, there is still room for growth, with global gold ETF holdings sitting 10 per cent below their 2020 high.”

Gold bar and coin demand rises

Total bar and coin demand remained strong, rising 3 per cent year-on-year to 325 tonnes. This increase was largely driven by a surge in retail investment in China, which posted its second-highest quarter on record.

The strength in Eastern markets helped offset a 22 per cent decline in demand from US investors and a modest recovery of 12 tonnes in Europe, albeit from a low base in Q1 2024.

In the Middle East, gold’s traditional appeal remained evident. “Gold investment demand in the Middle East remained resilient in Q1 2025, underpinned by continued geopolitical uncertainty and positive price expectations,” said Andrew Naylor, head of Middle East and Public Policy at the WGC. “Notably, Saudi Arabia saw a 15 per cent year-on-year increase in bar and coin demand, while jewellery demand in the kingdom rose 35 per cent – bucking regional trends.”

Central banks continued to be net buyers for the 16th consecutive year, adding 244 tonnes to global reserves in Q1 2025. Although this was 21 per cent lower than Q1 2024, it was in line with the average quarterly purchase volumes recorded over the past three years.

Jewellery demand hit

Jewellery demand, meanwhile, was impacted by the record price environment, with gold hitting 20 all-time highs during the quarter.

Global jewellery volumes fell to their lowest since 2020, when Covid-related restrictions curtailed demand. Despite this, consumer spending rose 9 per cent year-on-year to $35bn in Q1, as price appreciation drove value higher.

All markets except China recorded increases in the value of gold jewellery demand.

On the supply side, gold remained relatively flat at 1,206 tonnes. A record Q1 in mine production was largely offset by slightly lower levels of recycling. Technology demand was stable at 80 tonnes compared to the same period last year.

“It’s been a bumpy start to the year for global markets as trade turmoil, unpredictable US policy announcements, sustained geopolitical tensions and a return of recessionary fears have created a highly uncertain environment for investors,” Street noted. “In this context, investment demand for gold has paved the way for the highest level of first quarter demand since 2016.”

The WGC expects continued demand from institutions, individual investors, and central banks, as persistent global uncertainty enhances gold’s appeal as a safe haven asset.