The COVID-19 pandemic, with its far-reaching effects, was the driving factor behind gold consumer demand weakness throughout 2020, leading to a 14 per cent decline in annual demand to 3,759.6 tonnes. Last year was the first sub-4,000 tonnes year since 2009 according to the World Gold Council’s latest Gold Demand Trends report.
Global gold demand dropped by 28 per cent y-o-y to 783.4t in Q4, making it the weakest quarter since the midst of the global financial crisis in Q2 2008.
Gold jewellery demand in Q4 fell 13 per cent y-o-y to 515.9t, resulting in a full-year total of 1,411.6t, 34 per cent lower than in 2019 and a new annual low for our data series. While demand improved steadily from the severely depleted Q2 total, the coronavirus continued to impact consumer behaviour.
Total annual gold supply also took a hit and was 4 per cent lower y-o-y (4,633t), the largest annual fall since 2013. The drop can be largely explained by coronavirus-related disruption to mine production, offset by a marginal 1 per cent increase in recycling to 1,297.4t for 2020.
Inflows into global gold ETFs reached an annual record of 877.1t ($47.9bn). An 11-month consecutive run of positive inflows starting in December 2019 came to a halt in November when a recovery in sentiment and gold price drop led to 130t of outflows in Q4.
Reference: WGC
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